Exam 2: Trade-Offs,comparative Advantage,and the Market System

Figure 2-4 Figure 2-4 shows various points on three different production possibilities frontiers for a nation. -Refer to Figure 2-4.Consider the following events: a.an increase in the unemployment rate B.a decrease in a nation's money supply C.a war that kills a significant portion of a nation's population Which of the events listed above could cause a movement from Z to X ?

Which of the following is an example of spending on goods and services in the circular flow model?

________ exists because unlimited wants exceed the limited resources available to fulfill those wants.

When you purchase a new surfboard you do so in the

In a simple circular flow diagram,who supplies factors of production in markets and who buys these factors of production? Who supplies goods and services in markets and who buys these goods and services?

Table 2-9 Table 2-9 shows the number of labor hours required to produce a wristwatch and a pound of rice in Japan and Thailand. -Refer to Table 2-9.What is Japan's opportunity cost of producing one wristwatch?

Table 2-2 Production choices for Nadia's Neckware -Refer to Table 2-2.Assume Nadia's Neckware only produces ascots and bowties.A combination of 24 ascots and 12 bowties would appear

Table 2-1 Production Choices for Dina's Diner -Refer to Table 2-1.Assume Dina's Diner only produces sliders and hot wings.A combination of 60 sliders and 50 hot wings would appear

Table 2-4 Table 2-4 shows the output per day of two gardeners,George and Jack.They can either devote their time to mowing lawns or cultivating gardens. -Refer to Table 2-4.What is George's opportunity cost of mowing a lawn?

Figure 2-8 Figure 2-8 shows the production possibilities frontiers for Costa Rica and Guatemala.Each country produces two goods,pineapples and coconuts. -Refer to Figure 2-8.Which country has a comparative advantage in the production of coconuts?

Article Summary Since 2008, the United States has been involved in trade negotiations over the Trans-Pacific Partnership (TPP), a free trade agreement with 11 other countries on both sides of the Pacific Ocean. One area of the negotiations involves patents and intellectual property rights in the pharmaceutical industry. A number of developing countries have ignored international agreements concerning patents and intellectual property rights as a way to benefit their domestic pharmaceutical industries, to the detriment of those companies which have spent considerable time and money developing new medicines. For every 5,000 to 10,000 experimental drugs contemplated, only one will typically gain FDA approval, and this occurs only after up to 15 years of research at an average cost of more than $1 billion. Also, 30 percent of the U.S. workforce is either directly or indirectly employed in the pharmaceutical industry, so protection of these intellectual property rights is very important for the U.S. economy. Source: Doug Schoen, "Intellectual Property Rights Matter," Forbes, September 24, 2013. -Refer to the Article Summary.If these developing countries continue to ignore the international agreements which protect intellectual property rights,all of the following would most likely occur except

Which of the following statements about an entrepreneur is true?

The ability to exercise control over one's own resources within the confines of the law refers to

All of the following are examples of spending on goods and services in the circular flow model except

Table 2-1 Production Choices for Dina's Diner -Refer to Table 2-1.Assume Dina's Diner only produces sliders and hot wings.A combination of 20 sliders and 60 hot wings would appear

Figure 2-2 Figure 2-2 above shows the production possibilities frontier for Vidalia,a nation that produces two goods,roses and orchids. -Refer to Figure 2-2.What is the opportunity cost of one dozen roses?

Table 2-5 Table 2-5 shows the number of labor hours required to produce a cell phone and a board foot of lumber in Estonia and Finland. -Refer to Table 2-5.If the two countries specialize and trade,who should export lumber?

Figure 2-2 Figure 2-2 above shows the production possibilities frontier for Vidalia,a nation that produces two goods,roses and orchids. -Refer to Figure 2-2.If Vidalia chooses to produce 80 dozen roses,how many orchids can it produce to maximize production?

On a diagram of a production possibility frontier,economic decline (negative growth)is represented by the production possibility frontier shifting inward.

Figure 2-9 Figure 2-9 shows the production possibilities frontiers for Greenland and Iceland.Each country produces two goods,snow cones and popsicles. -Refer to Figure 2-9.If the two countries have the same amount of resources and the same technological knowledge,which country has an absolute advantage in the production of popsicles?