Exam 3: Interdependence and the Gains from Trade.

Opportunity cost refers to how many inputs a producer requires to produce a good.

Table 3-5 Assume that England and Spain can switch between producing cheese and producing bread at a constant rate. -Refer to Table 3-5.The opportunity cost of 1 unit of bread for Spain is

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.Miguel has an absolute advantage in the production of

Table 3-12 -Refer to Table 3-1.For the farmer,the opportunity cost of 1 pound of potatoes is

Figure 3-6 -Refer to Figure 3-6.If Maxine and Daisy switch from each person dividing her time equally between the production of pies and tarts to each person spending all of her time producing the good in which she has a comparative advantage,then total production of tarts will increase by

Figure 3-5 -Refer to Figure 3-5.If Hosne and Merve switch from each person dividing her time equally between the production of purses and wallets to each person spending all of her time producing the good in which she has a comparative advantage,then total production of purses will increase by

If one producer has the absolute advantage in the production of all goods,then that same producer will have the comparative advantage in the production of all goods as well.

Suppose that a worker in Freedonia can produce either 6 units of corn or 2 units of wheat per year,and a worker in Sylvania can produce either 2 units of corn or 6 units of wheat per year.Each nation has 10 workers.Without trade,Freedonia produces and consumes 30 units of corn and 10 units of wheat per year.Sylvania produces and consumes 10 units of corn and 30 units of wheat.Suppose that trade is then initiated between the two countries,and Freedonia sends 30 units of corn to Sylvania in exchange for 30 units of wheat.Sylvania will now be able to consume a maximum of

Table 3-10 Juanita and Shantala run a business that programs and tests cellular phones. Assume that Juanita and Shantala can switch between programming and testing cellular phones at a constant rate. The following table applies. -Refer to Table 3-10.Which of the following points would be on Shantala's production possibilities frontier,based on a 40-hour week?

Figure 3-4 -Refer to Figure 3-4.If Perry and Jordan each spends all of his/her time producing the good in which s/he has a comparative advantage and trade takes place at a price of 1 novel for 7 poems,then

Figure 3-6 -Refer to Figure 3-6.Suppose Maxine decides to increase her production of tarts by 5.What is the opportunity cost of this decision?

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 20 bushels of corn or 5 bushels of oats per year.There are 20 workers in Cornland and 20 workers in Oatland.Which of the following statements is true?

Figure 3-4 -Refer to Figure 3-4.If the production possibilities frontiers shown are each for one year of writing,then which of the following combinations of novels and poems could Perry and Jordan together not write in a given year?

Figure 3-3 -Refer to Figure 3-3.If the production possibilities frontier shown for Arturo is for 100 hours of production,then how long does it take Arturo to make one burrito?

Which famous economist developed the principle of comparative advantage as we know it today?

In most countries today,many goods and services consumed are imported from abroad,and many goods and services produced are exported to foreign customers.

Specialization and trade are closely linked to

Production possibilities frontiers cannot be used to illustrate tradeoffs.

Table 3-12 -Refer to Table 3-1.For the farmer,12.8 pounds of

Figure 3-3 -Refer to Figure 3-3.If Arturo and Dina both spend all of their time producing tacos,then total production is