Question 1

Table 3-31
   -Refer to Table 3-31. For the rancher, the opportunity cost of 16 pounds of meat is A)  4.0 pounds of potatoes. B)  5.2 pounds of potatoes. C)  6.4 pounds of potatoes. D)  9.6 pounds of potatoes." class="answers-bank-image d-inline" rel="preload" >  
-Refer to Table 3-31. For the rancher, the opportunity cost of 16 pounds of meat is

Accepted Answer

A)   4.0 pounds of potatoes.
B)   5.2 pounds of potatoes.
C)   6.4 pounds of potatoes.
D)   9.6 pounds of potatoes.E) None of the above
F) B) and D)

Question 2

Define comparative advantage.

Accepted Answer

Comparative advantage means a ...

Question 3

A production possibilities frontier is a straight line when

Accepted Answer

A)   the more resources the economy uses to produce one good, the fewer resources it has available to produce the other good.
B)   an economy is interdependent and engaged in trade instead of self-sufficient.
C)   the rate of tradeoff between the two goods being produced is constant.
D)   the rate of tradeoff between the two goods being produced depends on how much of each good is being produced.E) A) and D)
F) B) and C)

Question 4

A person can benefit from specialization and trade by obtaining a good at a price that is

Accepted Answer

A)   lower than his or her opportunity cost of that good.
B)   the same as his or her opportunity cost of that good.
C)   higher than his or her opportunity cost of that good.
D)   different than his or her opportunity cost of that good.E) C) and D)
F) B) and C)

Question 5

Table 3-18
The following table contains some production possibilities for an economy for a given month.
 
-Refer to Table 3-18. If the production possibilities frontier is bowed outward, then "?" could be

Accepted Answer

A)   150.
B)   225.
C)   300.
D)   375.E) A) and B)
F) B) and D)

Question 6

Table 3-25
Assume that Maya and Miguel can switch between producing mixers and producing toasters at a constant rate.
 
-Refer to Table 3-25. Maya has an absolute advantage in the production of

Accepted Answer

A)   both goods and a comparative advantage in the production of mixers.
B)   both goods and a comparative advantage in the production of toasters.
C)   neither good and a comparative advantage in the production of mixers.
D)   neither good and a comparative advantage in the production of toasters.E) B) and C)
F) A) and B)

Question 7

Differences in opportunity cost allow for gains from trade.

Accepted Answer

A) True 
 B)False

Question 8

Table 3-22
Assume that Zimbabwe and Portugal can switch between producing toothbrushes and producing hairbrushes at a constant rate.
 
-Refer to Table 3-22. Suppose Zimbabwe decides to increase its production of toothbrushes by 10. What is the opportunity cost of this decision?

Accepted Answer

A)   0.3 hairbrush
B)   3 hairbrushes
C)   30 hairbrushes
D)   100 hairbrushesE) A) and B)
F) A) and C)

Question 9

Figure 3-17
Maxine's Production Possibilities Frontier Daisy's Production Possibilities Frontier
 
-Refer to Figure 3-17. Suppose Maxine decides to increase her production of tarts by 5. What is the opportunity cost of this decision?

Accepted Answer

A)   2/5 pie
B)   2 pies
C)   5/2 pies
D)   10 piesE) B) and D)
F) B) and C)

Question 10

Table 3-23
Assume that the farmer and the rancher can switch between producing pork and producing tomatoes at a constant rate.
 
-Refer to Table 3-23. Assume that the farmer and the rancher each has 24 labor hours available. If each person spends all his time producing the good in which he has a comparative advantage, then total production is

Accepted Answer

A)   4 pounds of pork and 6 pounds of tomatoes.
B)   6 pounds of pork and 8 pounds of tomatoes.
C)   4 pounds of pork and 8 pounds of tomatoes.
D)   6 pounds of pork and 6 pounds of tomatoes.E) A) and B)
F) A) and C)

Question 11

Two individuals engage in the same two productive activities. In which of the following circumstances would neither individual have a comparative advantage in either activity?

Accepted Answer

A)   One individual's production possibilities frontier is steeper than the other individual's production possibilities frontier.
B)   One individual is faster at both activities than the other individual.
C)   One individual's opportunity costs are the same as the other individual's opportunity costs.
D)   None of the above is correct; one of the two individuals always will have a comparative advantage in at least one of the two activities.E) B) and C)
F) A) and D)

Question 12

For international trade to benefit a country, it must benefit all citizens of that country.

Accepted Answer

A) True 
 B)False

Question 13

Figure 3-2
Brazil's Production Possibilities Frontier 
-Refer to Figure 3-2. If the production possibilities frontier shown is for two months of production, then which of the following combinations of peanuts and cashews could Brazil produce in two months?

Accepted Answer

A)   7 peanuts and 35 cashews
B)   5 peanuts and 100 cashews
C)   2 peanuts and 190 cashews
D)   3 peanuts and 150 cashewsE) All of the above
F) A) and C)

Question 14

Which of the following is not a reason people choose to depend on others for goods and services?

Accepted Answer

A)   to improve their lives
B)   to allow them to enjoy a greater variety of goods and services
C)   to consume more of each good without working any more hours
D)   to allow people to produce outside their production possibilities frontiersE) B) and C)
F) A) and D)

Question 15

Figure 3-17
Maxine's Production Possibilities Frontier Daisy's Production Possibilities Frontier
 
-Refer to Figure 3-17. Suppose Daisy is willing to trade 3/4 tart to Maxine for each pie that Maxine makes and sends to Daisy. Which of the following combinations of pies and tarts could Maxine not then consume, assuming Maxine specializes in making pies and Daisy specializes in making tarts?

Accepted Answer

A)   4 pies and 6 tarts
B)   6 pies and 5 tarts
C)   8 pies and 3 tarts
D)   10 pies and 1.5 tartsE) B) and D)
F) B) and C)

Question 16

Which of the following is not correct?

Accepted Answer

A)   Economists are generally united in their support of free trade.
B)   The conclusions of Adam Smith and David Ricardo on the gains from trade have held up well over time.
C)   David Ricardo argued that Britain should not restrict imports of grain.
D)   Economists' opposition to trade restrictions is still based largely on the principle of absolute advantage.E) A) and B)
F) None of the above

Question 17

A production possibilities frontier is a graph that shows the combination of outputs that an economy should produce.

Accepted Answer

A) True 
 B)False

Question 18

Ken and Traci are two woodworkers who both make tables and chairs. In one month, Ken can make 3 tables or 18 chairs, whereas Traci can make 8 tables or 24 chairs. Given this, we know that the opportunity cost of 1 table is

Accepted Answer

A)   1/6 chair for Ken and 1/3 chair for Traci.
B)   1/6 chair for Ken and 3 chairs for Traci.
C)   6 chairs for Ken and 1/3 chair for Traci.
D)   6 chairs for Ken and 3 chairs for Traci.E) B) and D)
F) B) and C)

Question 19

Figure 3-7
Bintu's Production Possibilities Frontier Juba's Production Possibilities Frontier 
-Refer to Figure 3-7. If Bintu and Juba both spend all of their time making bowls, then total production is

Accepted Answer

A)   2 bowls.
B)   3 bowls.
C)   4 bowls.
D)   6 bowls.E) None of the above
F) A) and D)

Question 20

It takes Heather 1 hour to change the oil in the car and 20 minutes to do the dishes. It takes Zach 1.5 hours to change the oil in the car. For Zach to have a comparative advantage changing the oil it must take him more than minutes to do the dishes.

Accepted Answer

The answer of It takes Heather 1 hour to change...

Exam 3: Interdependence and the Gains From Trade

Correct Answer
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A production possibilities frontier is a graph that shows the combination of outputs that an economy should produce.

Correct Answer
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Which of the following is not a reason people choose to depend on others for goods and services?

Correct Answer
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A production possibilities frontier is a straight line when

Correct Answer
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Correct Answer
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Which of the following is not correct?

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Table 3-22 Assume that Zimbabwe and Portugal can switch between producing toothbrushes and producing hairbrushes at a constant rate. -Refer to Table 3-22. Suppose Zimbabwe decides to increase its production of toothbrushes by 10. What is the opportunity cost of this decision?

Correct Answer
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Define comparative advantage.

Correct Answer
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Comparative advantage means a ...
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Figure 3-7 Bintu's Production Possibilities Frontier Juba's Production Possibilities Frontier -Refer to Figure 3-7. If Bintu and Juba both spend all of their time making bowls, then total production is

Correct Answer
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Table 3-18 The following table contains some production possibilities for an economy for a given month. -Refer to Table 3-18. If the production possibilities frontier is bowed outward, then "?" could be

Correct Answer
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A person can benefit from specialization and trade by obtaining a good at a price that is

Correct Answer
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Figure 3-17 Maxine's Production Possibilities Frontier Daisy's Production Possibilities Frontier -Refer to Figure 3-17. Suppose Maxine decides to increase her production of tarts by 5. What is the opportunity cost of this decision?

Correct Answer
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Figure 3-2 Brazil's Production Possibilities Frontier -Refer to Figure 3-2. If the production possibilities frontier shown is for two months of production, then which of the following combinations of peanuts and cashews could Brazil produce in two months?

Correct Answer
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Two individuals engage in the same two productive activities. In which of the following circumstances would neither individual have a comparative advantage in either activity?

Correct Answer
verified

Differences in opportunity cost allow for gains from trade.

Correct Answer
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It takes Heather 1 hour to change the oil in the car and 20 minutes to do the dishes. It takes Zach 1.5 hours to change the oil in the car. For Zach to have a comparative advantage changing the oil it must take him more than minutes to do the dishes.

Correct Answer
verified

For international trade to benefit a country, it must benefit all citizens of that country.

Correct Answer
verified

Table 3-31 -Refer to Table 3-31. For the rancher, the opportunity cost of 16 pounds of meat is

Correct Answer
verified

Table 3-25 Assume that Maya and Miguel can switch between producing mixers and producing toasters at a constant rate. -Refer to Table 3-25. Maya has an absolute advantage in the production of

Correct Answer
verified

Ken and Traci are two woodworkers who both make tables and chairs. In one month, Ken can make 3 tables or 18 chairs, whereas Traci can make 8 tables or 24 chairs. Given this, we know that the opportunity cost of 1 table is

Correct Answer
verified

Exam 3: Interdependence and the Gains From Trade

Correct AnswerverifiedShow Answer

A production possibilities frontier is a graph that shows the combination of outputs that an economy should produce.

Correct AnswerverifiedShow Answer

Which of the following is not a reason people choose to depend on others for goods and services?

Correct AnswerverifiedShow Answer

A production possibilities frontier is a straight line when

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is not correct?

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Table 3-22 Assume that Zimbabwe and Portugal can switch between producing toothbrushes and producing hairbrushes at a constant rate. -Refer to Table 3-22. Suppose Zimbabwe decides to increase its production of toothbrushes by 10. What is the opportunity cost of this decision?

Correct AnswerverifiedShow Answer

Define comparative advantage.

Correct AnswerverifiedComparative advantage means a ...View AnswerShow Answer

Figure 3-7 Bintu's Production Possibilities Frontier Juba's Production Possibilities Frontier -Refer to Figure 3-7. If Bintu and Juba both spend all of their time making bowls, then total production is

Correct AnswerverifiedShow Answer

Table 3-18 The following table contains some production possibilities for an economy for a given month. -Refer to Table 3-18. If the production possibilities frontier is bowed outward, then "?" could be

Correct AnswerverifiedShow Answer

A person can benefit from specialization and trade by obtaining a good at a price that is

Correct AnswerverifiedShow Answer

Figure 3-17 Maxine's Production Possibilities Frontier Daisy's Production Possibilities Frontier -Refer to Figure 3-17. Suppose Maxine decides to increase her production of tarts by 5. What is the opportunity cost of this decision?

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Figure 3-2 Brazil's Production Possibilities Frontier -Refer to Figure 3-2. If the production possibilities frontier shown is for two months of production, then which of the following combinations of peanuts and cashews could Brazil produce in two months?

Correct AnswerverifiedShow Answer

Two individuals engage in the same two productive activities. In which of the following circumstances would neither individual have a comparative advantage in either activity?

Correct AnswerverifiedShow Answer

Differences in opportunity cost allow for gains from trade.

Correct AnswerverifiedShow Answer

It takes Heather 1 hour to change the oil in the car and 20 minutes to do the dishes. It takes Zach 1.5 hours to change the oil in the car. For Zach to have a comparative advantage changing the oil it must take him more than minutes to do the dishes.

Correct AnswerverifiedShow Answer

For international trade to benefit a country, it must benefit all citizens of that country.

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Table 3-31 -Refer to Table 3-31. For the rancher, the opportunity cost of 16 pounds of meat is

Correct AnswerverifiedShow Answer

Table 3-25 Assume that Maya and Miguel can switch between producing mixers and producing toasters at a constant rate. -Refer to Table 3-25. Maya has an absolute advantage in the production of

Correct AnswerverifiedShow Answer

Ken and Traci are two woodworkers who both make tables and chairs. In one month, Ken can make 3 tables or 18 chairs, whereas Traci can make 8 tables or 24 chairs. Given this, we know that the opportunity cost of 1 table is

Correct AnswerverifiedShow Answer

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Comparative advantage means a ...
View Answer

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