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

Figure 2-2 Figure 2-2 above shows the production possibilities frontier for Mendonca, an agrarian nation that produces two goods, meat and vegetables. -Refer to Figure 2-2.What is the opportunity cost of one pound of meat?

Table 2-10 Table 2-10 shows the output per day of two pet groomers, Tammi and Horace. They can either devote their time to grooming dogs or bathing cats. -Refer to Table 2-10.What is Tammi's opportunity cost of grooming a dog?

An example of a factor of production is

Pierre can produce either a combination of 20 bow ties and 30 neckties or a combination of 35 bow ties and 15 neckties.If he now produces 35 bow ties and 15 neckties,what is the opportunity cost of producing an additional 15 neckties?

What shape does a production possibilities frontier take if it displays increasing opportunity costs? What shape does a production possibilities frontier take if it displays constant opportunity costs? Which shape is most common in production situations?

How do firms and households interact in markets?

If Sanjaya can shuck more oysters in one hour than Tatiana,then Sanjaya has a comparative advantage in shucking oysters.

"An Inquiry into the Nature and Causes of the Wealth of Nations" published in 1776 was written by

Figure 2-2 Figure 2-2 above shows the production possibilities frontier for Mendonca, an agrarian nation that produces two goods, meat and vegetables. -Refer to Figure 2-2.The linear production possibilities frontier in the figure indicates that

Which of the following statements about an entrepreneur is false?

Consider a country that produces only two goods: parrots and iguanas.Suppose it is impossible for this country to increase its production of parrots without producing fewer iguanas.In this case,its current output combination is efficient.

If society decides it wants more of one good and all resources are fully utilized,then

Table 2-8 Table 2-8 shows the number of labor hours required to produce a digital camera and a pound of wheat in China and South Korea. -Refer to Table 2-8.If the two countries specialize and trade,who should export wheat?

The production possibilities frontier model shows that

For each bottle of wine that Italy produces,it gives up the opportunity to make 10 pounds of cheese.France can produce 1 bottle of wine for every 25 pounds of cheese it produces.Which of the following is true about the comparative advantage between the two countries?

When you purchase a new set of spurs you do so in the

Table 2-3 Production Choices for Dina's Diner -Refer to Table 2-3.Assume Dina's Diner only produces sliders and hot wings.A combination of 80 sliders and 50 hot wings would appear

Table 2-7 Table 2-7 shows the output per month of two people, Fred and Barney. They can either devote their time to making pogo sticks or making unicycles. -Refer to Table 2-7.What is Barney's opportunity cost of making a pogo stick?

Table 2-11 Table 2-11 shows the number of labor hours required to produce a motorcycle and a guitar in Ireland and Scotland. -Refer to Table 2-11.Ireland has a comparative advantage in the production of

For a person to have a comparative advantage in producing a product,she must be able to produce that product at a lower opportunity cost than her competitors.