Exam 2: Model Building and Gains From Trade

Draw a production possibilities frontier (PPF)for good A and good B.Suppose that these goods are subject to increasing relative costs in production,and be sure that your graph reflects this fact. Now suppose that a new and innovative technology enhances the production of good A but not good B.Illustrate how this new innovation changes the production possibilities frontier (PPF).

use the figure below to answer the following questions -Which of the following represents an inefficient point?

If Kingsley can sell paper at a lower opportunity cost than Todrick,then ________ has a(n)________ advantage in paper sales.

use the Table below to answer the following questions : -Given the same quantity of resources,what is Solange's opportunity cost of producing a New York pizza?

use the figures below to answer the following questions : the production possibilities frontier (PPF)curves,which compare the ancient production of agricultural products to art and literature A. B. C. D. E. -Suppose a new generation of baby boomers is entering the workforce.Which graph best depicts how this would affect the PPF?

Explain why,ultimately,the opportunity cost of producing consumer goods instead of capital goods must be defined in terms of consumer goods.

When one producer has a comparative advantage in production,he or she

use the figures below to answer the following questions :the production possibilities frontiers (PPFs)for two people who can allocate the same amount of time between building wooden boats and solving crimes. -What is DiNozzo's opportunity cost of making a wooden boat?

On a production possibilities frontier (PPF)that shows the trade-off between consumer goods and capital goods given a fixed amount of labor,unemployment is illustrated by

When testing a paper airplane on a campus quad,which of the following would be an exogenous factor?

use the figure below to answer the following questions -We can see that the opportunity cost of moving from point D to point E is different from the opportunity cost of moving from point D to point C because

Goods that are produced today in order to make other valuable goods and services in the future are called ________ goods.

use the figure below to answer the following questions : -As we move from points N to M to L,the opportunity cost of additional apple pie

Over the last 20 years,countries such as India and China have

An increase in the labor force would be reflected in a society's production possibilities frontier (PPF)by an

Suppose that Lo and Manuel can either run errands or wash dishes.Their maximum outputs per hour are listed in the following table.Given the same quantity of resources,at what terms of trade (relative price ratio)could they specialize and trade so that both consume outside their own production possibilities frontiers (PPFs)?

When economists use models to make predictions,faulty assumptions can have disastrous consequences.Why is "avoid making assumptions" not the solution to this problem? Use the concepts of endogenous and exogenous factors to explain.

Comment on the role of models in economics.What are the strengths and weaknesses of using them to explore the world around us?

Specialization and trade allow individuals to

A society that is producing its maximum combination of goods and using all available resources for production