Exam 2: Comparative Advantage

Generally, on a linear two-good production possibilities curve, the opportunity cost of the good measured on the vertical axis is:

Lou and Alex live together and share household chores. They like to cook some meals ahead of time and eat leftovers. The table below shows the number of rooms they can each clean and the number of meals they can each cook in an hour. Rooms Cleaned Per Hour Meals Cooked Per Hour Lou 5 4 Alex 3 3 If Alex and Lou work out an efficient arrangement for these two chores, then under that arrangement:

An individual has an absolute advantage in producing pizzas if that individual:

Smith and Jones comprise a two-person economy. Their hourly rates of production are shown below. Calculators Per Hour Computers Per Hour Smith 100 10 Jones 120 6 Suppose Smith and Jones begin by producing 16 computers and 0 calculators per hour. If they wish to produce 14 computers and 40 calculators per hour efficiently, then Smith should spend ______, and Jones should spend ______.

You are the Minister of Trade for a small island country with the following annual PPC: You are negotiating a trade agreement with a neighboring island with the following annual PPC: Both islands specialize exclusively in the product for which they have a comparative advantage. You have agreed to give 350 coconuts to the other island in exchange for 1,300 fish. After the trade the other island has a total of ______ coconuts and ______ fish.

All else equal, the jobs that are the least likely to be outsourced are those that:

Dent 'n' Scratch Used Cars and Trucks employs 3 salesmen. Data for their sales last month are shown in this table: Cars Sold Trucks Sold Larry 10 5 Joe 9 9 Ralph 3 12 Based on last month's data, Ralph's opportunity cost of selling a truck is selling:

Ginger and Maryann are lost in the jungle, where the only things to eat are mangoes and fish. Ginger can gather more mangoes per hour than Maryann and can also catch more fish per hour than can Maryann. Therefore:

The figure below shows Avery's weekly production possibilities curve for scarves. For Avery, the opportunity cost of making a red scarf is:

Suppose Colin brews beer and makes cheese. If Colin can increase his production of beer without decreasing his production of cheese, then he is producing at an:

An increase in an economy's productive resources will lead the production possibilities curve to:

The figure below shows Becky's daily production possibilities curve for dresses and skirts. Point U is:

On a graph of a production possibilities curve, an inefficient point is:

Refer to the table below. Based on their comparative advantage, Martha should specialize in _______ while Julia should specialize in _______. Time to Make a Pie Time to Make a Cake Martha 60 minutes 80 minutes Julia 50 minutes 60 minutes

When a nation reduces the barriers to international trade:

If a given production combination is efficient, then it must be:

The figure below shows Becky's daily production possibilities curve for dresses and skirts. Point Y is ______, and point V is ______.

According to the textbook, the evidence indicates that NAFTA has:

Assume point A on a linear production possibilities curve represents the combination of 12 coffees and 3 cappuccinos, and point B represents 3 coffees and 6 cappuccinos. Suppose coffees are on the vertical axis and cappuccinos are on the horizontal axis. The opportunity cost of a cup of coffee is:

Lou and Alex live together and share household chores. They like to cook some meals ahead of time and eat leftovers. The table below shows the number of rooms they can each clean and the number of meals they can each cook in an hour. Rooms Cleaned Per Hour Meals Cooked Per Hour Lou 5 4 Alex 3 3 Which of the following is true?