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

One Motorcycle One Guitar Ireland 20 hours 4 hours Scotland 8 hours 2 hours Table 2-14 shows the number of labor hours required to produce a motorcycle and a guitar in Ireland and Scotland. -Refer to Table 2-14.Does either Ireland or Scotland have an absolute advantage and if so,in what product?

If a commercial dairy farm wants to raise funds to purchase feeding troughs,it does so in the

Figure 2-14 shows the production possibilities frontiers for Greenland and Iceland.Each country produces two goods,snow cones and popsicles. -Refer to Figure 2-14.What is the opportunity cost of producing 1 popsicle in Greenland?

Which of the following would shift a nation's production possibilities frontier inward?

________ shows that if all resources are fully and efficiently utilized,more of one good can be produced only by producing less of another good.

On a diagram of a production possibilities frontier,opportunity cost is represented by the production possibilities frontier shifting outward.

Table 2-5 Production choices for Nadia's Neckware Choice Quantity of Ascots Produced Quantity of Bowties Produced A 32 0 B 24 6 C 16 12 D 8 18 E 0 24 -Refer to Table 2-5.Assume Nadia's Neckware only produces ascots and bowties.A combination of 8 ascots and 18 bowties would appear

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

In 18th century Europe,governments gave guilds legal authority to limit production of goods.This authority obstructed the market mechanism because the guild's actions prevented the forces of ________ from coordinating the self-interested decisions of producers and consumers.

In economics,the term "free market" refers to a market where products are traded but not sold.

Figure 2-8 above shows the production possibilities frontier for Vidalia,a nation that produces two goods,roses and orchids. -Refer to Figure 2-8.What is the opportunity cost of one dozen orchids?

Wilma Betty Statues 12 14 Benches 4 7 Table 2-19 shows the output per month of two people,Wilma and Betty.They can either devote their time to making marble statues or making marble benches. -Refer to Table 2-19.What is Wilma's opportunity cost of making a statue?

A welding machine is an example of a factor of production if it is being used to produce automobiles.

An inward shift of a nation's production possibilities frontier can occur due to

Figure 2-8 above shows the production possibilities frontier for Vidalia,a nation that produces two goods,roses and orchids. -Refer to Figure 2-8.Suppose Vidalia is currently producing 60 dozen orchids per period.How many roses is it also producing,assuming that resources are fully utilized?

Is it possible for a firm to have an absolute advantage in producing something without having a comparative advantage? Why or why not?

For a person to have a comparative advantage in producing a product,he must be able to produce that product at a higher opportunity cost than his competitors.

Figure 2-11 shows the production possibilities frontiers for Pakistan and Indonesia.Each country produces two goods,cotton and cashews. -Refer to Figure 2-11.What is the opportunity cost of producing 1 pound of cashews in Pakistan?

Which of the following are represented by the same flow in the circular flow model?

The Great Depression of the 1930s,with a large number of workers and factories unemployed,would be represented in a production possibilities frontier graph by