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 movements: a.from point V to point W b.from point W to point Y c.from point Y to point Z Which of the movements listed above represents economic growth?

Table 2-17 -

If a nation changes its laws to more actively enforce intellectual property rights,all of the following will most likely take place except

Table 2-5 -Refer to Table 2-5.The Shellfish Shack produces only shrimp and oysters.The table above shows the maximum possible output combinations of the two types of shellfish using all resources and currently available technology. a. Suppose The Shellfish Shack is currently producing at point E.What is the opportunity cost of producing an additional 11,000 pounds of oysters? b. Suppose The Shellfish Shack is currently producing at point E.What happens to the opportunity cost of producing more and more shrimp? Does it increase,decrease or remain constant? Explain your answer. c. Suppose The Shellfish Shack is currently producing at point B.What happens to the opportunity cost of producing more and more oysters? Does it increase,decrease or remain constant? Explain your answer. d. Suppose The Shellfish Shack is plagued by a disease which destroys oyster beds but not shrimp habitats.What would happen to its PPF?

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

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

Table 2-2 Production choices for Billie's Bedroom Shop -Refer to Table 2-2.Assume Billie's Bedroom Shop only produces pillows and blankets.Billie faces ________ opportunity costs in the production of pillows and blankets.

Table 2-12 - h.Show the consumption points after trade on each country's production possibilities frontier.Label these points "B" for China and "J" for South Korea. i.Has trade made the two countries better off? Explain your answer.

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.Which of the following statements is true?

An increase in the unemployment rate may be represented as a movement from a point on the production possibilities frontier to a different point on the frontier.

Consider the following items: a.the novel "The DaVinci Code" by Dan Brown b.the "The Spirited Shipper," an innovative wine shipping box c.a Swiss chef's award-winning recipe d.an original fabric design,for example,the fabric used for "Coach" bags and luggage Which of the items listed is an example of intellectual property?

Suppose your expenses for this term are as follows: tuition: $12,000,room and board: $6,500,books and other educational supplies: $1,500.Further,during the term,you can only work part-time and earn $3,500 instead of your full-time salary of $14,000.What is the opportunity cost of going to college this term,assuming that your room and board expenses would be the same even if you did not go to college?

Which of the following is an examples of spending on factors of production in the circular flow model?

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.What is Ireland's opportunity cost of producing one motorcycle?

Figure 2-14 -Refer to Figure 2-14.Which two arrows in the diagram depict the following transaction: LaDonna sells 20 pairs of sunglasses at the Oakley store.

An example of a factor of production is

If a country is producing efficiently and is on the production possibilities frontier,the country can produce more of one good without producing less of the other good.

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 digital cameras?

Figure 2-9 Figure 2-9 shows the production possibilities frontiers for Pakistan and Indonesia. Each country produces two goods, cotton and cashews. -Refer to Figure 2-9.Which country has a comparative advantage in the production of cashews?

Tesla Motors manufacturers its cars at a plant in Fremont,California.At this plant,Tesla is able to take advantage of the high level of technical training possessed by its American workers,but it also sacrifices the ability to pay lower wages had it chosen to open its plant in a low-wage country such as Mexico,India,or China.In deciding to open the Fremont plant,Tesla