Exam 3: The Economic Problem

Hank requires 1 hour to cut the grass and 3 hours to clean the house.His sister Holly requires 1 hour to cut the grass and 4 hours to clean the house.Which of the following statements is true?

-The above figure shows the production possibility frontier for a country.Suppose the country is producing at point E.What would be the opportunity cost to increase the production of wine to 9 thousand bottles?

A country produces only apples and bananas.Moving from point A to point B along its production possibilities frontier,5 apples are forgone and 4 bananas are gained.What is the opportunity cost of a banana?

When all of the available factors of production are being efficiently employed,the

"If Mexico is currently operating at a point inside its production possibilities frontier,then there are unemployed or misallocated resources in Mexico." Is this statement true or false? Briefly explain your answer.

-Suppose India and France have the same PPF,shown in the figure above.Based on their current production points,which is France's most likely future PPF?

In order for Ireland to grow more potatoes,wool production must decrease.This situation is an example of

If Toni has an absolute advantage in both sewing and ironing when compared to Tom,then

-Suppose that Germany,France,Estonia,and India all have the same production possibilities,illustrated in the figure above.Based on the production points in the figure,which country is most likely to expand its PPF to PPF??

On a production possibilities frontier,500 pounds of apples and 1,200 pounds of bananas can be produced while at another point on the same frontier,300 pounds of apples and 1,300 pounds of bananas can be produced.Between these points,what is the opportunity cost of producing a pound of apples?

Increasing opportunity cost exists

-Deb and Pete have volunteered to help their favorite charity mail out fundraiser information.The figure above shows their production possibilities frontiers for assembling packets and stuffing envelopes.What is Deb's opportunity cost of assembling 1 packet?

-The above figure shows the production possibility frontier for a country.Suppose the country is producing at point D.What is the opportunity cost of increasing the production of rice to 15 tons?

-A (very,very small)country produces milk and shirts and its production possibilities frontier is in the table above. a.The nation is currently producing at point B.What is the opportunity cost of two additional gallons of milk? At point C? At point D? What do your results show? b.Suppose the nation is initially producing 4 gallons of milk and 40 shirts.What is the opportunity cost of 2 additional gallons of milk? Explain your answer.

-The figure above shows the production possibilities frontiers for the United Kingdom and France.If the United Kingdom and France specialize and engage in trade,the United Kingdom will export ________ and France will export ________.

Using the figure above,suppose with no trade Liz and Joe each produce at point A on their respective PPFs.Then,Liz suggests that they specialize and trade.She would produces only smoothies and Joe would produce only salads.Then she would sell 10 smoothies to Joe at a price of 2.5 salads per smoothie.In this scenario,

For country North,the opportunity cost incurred when 3 tractors are produced is 21 watches.For country South,the opportunity cost incurred when 5 tractors are produced is 100 watches.Which country has the comparative advantage in the production of tractors?

-In the above table,for Mary the opportunity cost of producing a dress is ________,and the opportunity cost for Mark of producing a dress is ________.

If a nation devotes a larger share of its current production to consumption goods,then

-The table above shows a production possibilities frontier for an economy.Which of the following combinations is unattainable?