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

If additional units of a good could be produced at a constant opportunity cost,the production possibility frontier would be bowed outward (concave).

Any output combination outside a production possibility frontier is associated with unused or underutilized resources.

Suppose there is no unemployment in the economy and society decides that it wants more of one good.Which of the following statements is true?

The opportunity cost of taking a semester-long economics class is

Which of the following statements about a simple circular flow model is false?

Which of the following is a flow in the circular flow model?

The principle of opportunity cost is that

BMW recently decided to build a manufacturing plant in Shenyang,China.At this plant,BMW is able to take advantage of paying lower wages to its Chinese workers than it pays its German workers,but it also sacrifices the high levels of technical training possessed by its German workers.In deciding to open the Shenyang plant,BMW

If the best surgeon in town is also the best at cleaning swimming pools,then according to economic reasoning,this person should

Figure 2-7 Figure 2-7 shows the production possibilities frontiers for Pakistan and Indonesia. Each country produces two goods, cotton and cashews. -Refer to Figure 2-7.Which country has a comparative advantage in the production of cashews?

Figure 2-7 Figure 2-7 shows the production possibilities frontiers for Pakistan and Indonesia. Each country produces two goods, cotton and cashews. -Refer to Figure 2-7.What is the opportunity cost of producing 1 pound of cashews in Indonesia?

A major factor contributing to the slow growth rate of less developed economies is