Exam 3: Interdependence and the Gains From Trade

Table 3-12 -Refer to Table 3-12.Which of the following combinations of meat and potatoes could the farmer produce in 40 hours?

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.The opportunity cost of 1 mixer for Maya is

Figure 3-4 -Refer to Figure 3-4.Suppose Perry is willing to trade 4 poems to Jordan for each novel that Jordan writes and sends to Perry.Which of the following combinations of novels and poems could Jordan then consume,assuming Jordan specializes in novel production and Perry specializes in poem production?

People who provide you with goods and services

The only two countries in the world,Alpha and Omega,face the following production possibilities frontiers. Alpha's Production Possibilities Frontier Omega's Production Possibilities Frontier a. Assume that each country decides to use half of its resources in the production of each good.Show these points on the graphs for each country as point A. b. If these countries choose not to trade,what would be the total world production of popcorn and peanuts? c. Now suppose that each country decides to specialize in the good in which each has a comparative advantage.By specializing,what is the total world production of each product now? d. If each country decides to trade 100 units of popcorn for 100 units of peanuts,show on the graphs the gain each country would receive from trade.Label these points B.

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.Japan and Korea would not be able to gain from trade if Korea's opportunity cost of one car changed to

Which of the following statements is not correct?

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 3-7 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

Figure 3-6 -Refer to Figure 3-6.If Maxine and Daisy each divides her time equally between making pies and making tarts,then total production is

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.Juanita's opportunity cost of testing one cellular phone is programming

For both parties to gain from trade,the price at which they trade must lie between the two opportunity costs.

Table 3-8 Assume that Huang and Min can switch between producing parasols and producing porcelain plates at a constant rate. -Refer to Table 3-8.Min has an absolute advantage in the production of

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.Maya should specialize in the production of

Table 3-8 Assume that Huang and Min can switch between producing parasols and producing porcelain plates at a constant rate. -Refer to Table 3-8.The opportunity cost of 1 parasol for Min is

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.Which of the following combinations of wheat and beef could Andia produce in one 8-hour day?

Table 3-8 Assume that Huang and Min can switch between producing parasols and producing porcelain plates at a constant rate. -Refer to Table 3-8.The opportunity cost of 1 parasol for Huang is

Figure 3-9 -Refer to Figure 3-9.Suppose Azerbaijan is willing to trade 3 nails to Uzbekistan for every bolt that Uzbekistan makes and sends to Azerbaijan.Which of the following combinations of bolts and nails could Uzbekistan then consume,assuming Uzbekistan specializes in making bolts and Azerbaijan specializes in making nails?

Ellie and Brendan both produce apple pies and vanilla ice cream.If Ellie's opportunity cost of one apple pie is 1/2 gallon of ice cream and Brendan's opportunity cost of one apple pie is 1/4 gallon of ice cream,a mutually advantageous trade can be struck at a price of one apple pie for 1/3 gallon of ice cream.

The production possibilities frontier shows the trade-offs that the producer faces but does not identify the choice the producer will make.