Exam 2: Choices and Trade-Offs in the Market

You have an absolute advantage whenever you________.

If a country produces only two goods, then it is not possible to have an absolute advantage in the production of both those goods.

Table 2.8 Table 2.8 shows the number of labour hours required to produce a motorcycle and a guitar in Ireland and Scotland. -Refer to Table 2.8.What is Scotland's opportunity cost of producing one motorcycle?

Table 2.6 Table 2.6 shows the number of labour hours required to produce a digital camera and a kilo of wheat in China and South Korea. -Refer to Table 2.6.What is South Korea's opportunity cost of producing one kilo of wheat?

Consider the following items: a.the album '21' by Adele b.a Dutch horticulturalist's new method for cultivating hybrid tulips c.Rolls Royce's 'Spirit of Ecstasy' hood ornament design d.the sale of Tumi luggage at a Macy's department store Which of the items listed is an example of intellectual property?

Table 2.3 Production Choices for Dina's Cafe -Refer to Table 2.3.Assume Dina's Cafe only produces sliders and hot wings.A combination of 120 sliders and 100 hot wings would appear________.

In a two-good, two country world, if one country has an absolute advantage in the production of both goods, it must also have a comparative advantage in the production of both goods.

What does a successful market economy require?

The payment received by suppliers of entrepreneurial skills is called wages.

What does an outward shift of a nation's production possibility frontier represent?

An inward shift of a nation's production possibility frontier can occur due to________.

In a production possibility frontier model, a point ________ the frontier is productively inefficient.

If the opportunity cost of producing more of one good remains the same as more of that good is produced, then the production method is inefficient.

What does a production possibility frontier with a bowed outward shape indicate?

The payment received by suppliers of entrepreneurial skills is called interest.

Table 2.1 Production choices for Tomaso's Trattoria -Refer to Table 2.1.Assume Tomaso's Trattoria only produces pizzas and calzones.What type of opportunity costs does Tomasco face in the production of pizzas and calzones?

Table 2.6 Table 2.6 shows the number of labour hours required to produce a digital camera and a kilo of wheat in China and South Korea. -Refer to Table 2.6.South Korea has a comparative advantage in the production of:

Table 2.1 Production choices for Tomaso's Trattoria -Refer to Table 2.1.Assume Tomaso's Trattoria only produces pizzas and calzones.Where would a combination of 24 pizzas and 30 calzones appear________.

Table 2.6 Table 2.6 shows the number of labour hours required to produce a digital camera and a kilo of wheat in China and South Korea. -Refer to Table 2.6.If the two countries specialise and trade, who should export digital cameras?

Figure 2.6 Figure 2.6 above shows the production possibility frontier for Vidalia, a nation that produces two goods, roses and orchids. -Refer to Figure 2.6.What is the opportunity cost of 80 dozen orchids?