Exam 3: Interdependence and the Gains from Trade.

Table 3-1 Assume that Andia and Zardia can switch between producing wheat and producing beef at a constant rate. -Refer to Table 3-1.At which of the following prices would both Andia and Zardia gain from trade with each other?

Figure 3-10 Alice and Betty's Production Possibilities in one 8-hour day. -Refer to Figure 3-10.Which of the following statements is correct regarding absolute advantage?

Figure 3-4 -Refer to Figure 3-4.Perry has an absolute advantage in the production of

Figure 3-10 Alice and Betty's Production Possibilities in one 8-hour day. -Refer to Figure 3-10.If point A represents Alice's current production and point B represents Betty's current production,under what circumstances can both Alice and Betty benefit from specialization and trade?

Henry can make a bird house in 3 hours and he can make a bird feeder in 1 hour.The opportunity cost to Henry of making a bird house is 1/3 bird feeder.

Figure 3-7 -Refer to Figure 3-7.If Bintu and Juba switch from each person dividing her time equally between the production of cups and bowls to each person spending all of her time producing the good in which she has a comparative advantage,then total production will increase by

Table 3-6 Assume that Maya and Miguel can switch between producing mixers and producing toasters at a constant rate. -Refer to Table 3-6.At which of the following prices would both Maya and Miguel gain from trade with each other?

Belarus has a comparative advantage in the production of linen,but Russia has an absolute advantage in the production of linen.If these two countries decide to trade,

Figure 3-5 -Refer to Figure 3-5.Hosne has an absolute advantage in the production of

Trade can make everybody better off because it

Table 3-2 Assume that Aruba and Iceland can switch between producing coolers and producing radios at a constant rate. -Refer to Table 3-2.Which of the following represents Aruba's production possibilities frontier when 100 labor hours are available?

Table 3-6 Assume that Maya and Miguel can switch between producing mixers and producing toasters at a constant rate. -Refer to Table 3-6.Assume that Maya and Miguel each has 40 hours available.If each person divides his/her time equally between the production of mixers and toasters,then total production is

Figure 3-3 -Refer to Figure 3-3.If the production possibilities frontiers shown are each for one day of production,then which of the following combinations of tacos and burritos could Arturo and Dina together produce in a given day?

Figure 3-3 -Refer to Figure 3-3.Arturo should specialize in the production of

As a student,Anne spends 40 hours per week writing term papers and completing homework assignments.On one axis of her production possibilities frontier is measured the number of term papers written per week.On the other axis is measured the number of homework assignments completed per week.Anne's production possibilities frontier is a straight line if

Adam Smith developed the theory of comparative advantage as we know it today.

If US workers can produce everything in less time than Mexican workers,it is not possible for the US to gain from trade with Mexico.

Suppose that a worker in Cornland can grow either 40 bushels of corn or 10 bushels of oats per year,and a worker in Oatland can grow either 5 bushels of corn or 50 bushels of oats per year.There are 20 workers in Cornland and 20 workers in Oatland.If the two countries do not trade,Cornland will produce and consume 400 bushels of corn and 100 bushels of oats,while Oatland will produce and consume 60 bushels of corn and 400 bushels of oats.If each country made the decision to specialize in producing the good in which it has a comparative advantage,then the combined yearly output of the two countries would increase by

In which of the following cases should the United States produce more noodles than it wants for its own use and trade some of those noodles to Italy in exchange for wine?

Figure 3-5 -Refer to Figure 3-5.At which of the following prices would both Hosne and Merve gain from trade with each other?