Exam 2: Comparative Advantage

Suppose Cathy and Lewis work in a bakery making pies and cakes.Suppose it takes Cathy 1.5 hours to make a pie and 1 hour to make a cake, and suppose it takes Lewis 2 hours to make a pie and 1.5 hours to make a cake.Which of the following statements is correct?

Lou and Alex live together and share household chores.They like to cook some meals ahead of time and eat leftovers.The table below shows the number of rooms they can each clean and the number of meals they can each cook in an hour. For Alex, the opportunity cost of cleaning one room is making ______ meal(s); for Lou the opportunity cost of cleaning one room is making ______ meal(s).

If Al has an absolute advantage over Beth in preparing meals, then:

The downward slope of the production possibilities curve illustrates the:

Dent 'n' Scratch Used Cars and Trucks employs 3 salesmen.Data for their sales last month are shown in this table: Based on last month's data, ______ should specialize in truck sales, and ______ should specialize in car sales.

Refer to the table below.According to the table, Corey has the absolute advantage in:

A graph that illustrates the maximum amount of one good that can be produced for every possible level of production of the other good is called a(n):

An individual has an absolute advantage in producing pizzas if that individual:

Refer to the table below.Based on their comparative advantages, Pat should specialize in _______, and Corey should specialize in _______.

The figure below shows the production possibilities curve for the island of Genovia: The opportunity cost of producing a car in Genovia is:

Consider a graph of a production possibilities curve.If a producer is operating at an inefficient point, then that producer:

The benefits of specialization can be used to explain why:

If a nation has the lowest opportunity cost of producing a good, that nation has a(n) ______ in the production of that good.

Dent 'n' Scratch Used Cars and Trucks employs 3 salesmen.Data for their sales last month are shown in this table: Based on last month's data, ______ has an absolute advantage in selling cars and ______ has an absolute advantage in selling trucks.

Points that lie outside the production possibilities curve are ______, and points that lie inside the production possibilities curve are ______.

Lou and Alex live together and share household chores.They like to cook some meals ahead of time and eat leftovers.The table below shows the number of rooms they can each clean and the number of meals they can each cook in an hour. Which of the following is true?

Refer to the table below.Julia's opportunity cost of making a cake is:

Moe divides his time between studying Physics and studying Economics.His production possibilities curve for his final grade in each class is shown below. Which of the following is true?

When a U.S.firm engages in outsourcing, it benefits ______ and harms ______.

Ginger and Maryann are lost in the jungle, where the only things to eat are mangoes and fish.Ginger can gather more mangoes per hour than Maryann and can also catch more fish per hour than can Maryann.Therefore: