Exam 3: Interdependence and the Gains From Trade

Figure 3-11 The graph below represents the various combinations of ham and cheese (in pounds) that the nation of Bonovia could produce in a given month. -Refer to Figure 3-11. For Bonovia, what is the opportunity cost of a pound of cheese?

Table 3-7 Assume that Japan and Korea can switch between producing cars and producing airplanes at a constant rate. -Refer to Table 3-7. Korea should specialize in the production of

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. Without trade, England produced and consumed 32 units of cheese and 2 units of bread and Spain produced and consumed 6 units of cheese and 2 units of bread. Then, each country agreed to specialize in the production of the good in which it has a comparative advantage and trade 7 units of cheese for 2.5 units of bread. As a result, England gained

Table 3-13 The following table contains some production possibilities for an economy for a given month. SWratari Glavi 4 300 6 ? 8 100 -Refer to Table 3-13. If the production possibilities frontier is bowed outward, then "?" could be

Tom Brady should probably not mow his own lawn because

Figure 3-9 -Refer to Figure 3-9. Azerbaijan has an absolute advantage in the production of

Figure 3-8 -Refer to Figure 3-8. Chile's opportunity cost of one pound of soybeans is

If one producer is able to produce a good at a lower opportunity cost than some other producer, then the producer with the lower opportunity cost is said to have an absolute advantage in the production of that good.

Figure 3-11 The graph below represents the various combinations of ham and cheese (in pounds) that the nation of Bonovia could produce in a given month. -Refer to Figure 3-11. If the production possibilities frontier shown is for 240 hours of production, then how long does it take Bonovia to make one pound of cheese?

The principle of comparative advantage does not provide answers to certain questions. One of those questions is

Table 3-9 Barb and Jim run a business that sets up and tests computers. Assume that Barb and Jim can switch between setting up and testing computers at a constant rate. The following table applies. -Refer to Table 3-9. Barb's opportunity cost of setting up one computer is testing

Table 3-13 The following table contains some production possibilities for an economy for a given month. SWratari Glavi 4 300 6 ? 8 100 -Refer to Table 3-13. If the production possibilities frontier is a straight line, then "?" must be

Figure 3-8 -Refer to Figure 3-8. If the production possibilities frontiers shown are each for one day of production, then which of the following combinations of coffee and soybeans could Chile and Colombia together make in a given day?

For a self-sufficient producer, the production possibilities frontier

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

An assumption of the production possibilities frontier model is that technology is fixed.

Figure 3-4 -Refer to Figure 3-4. Perry has a comparative advantage in the production of

Figure 3-4 -Refer to Figure 3-4. Jordan should specialize in the production of

Figure 3-9 -Refer to Figure 3-9. Azerbaijan's opportunity cost of one bolt is

Table 3-12 -Refer to Table 3-12. Which of the following combinations of meat and potatoes could the rancher not produce in 40 hours?