Exam 3: Interdependence and the Gains From Trade

Which of the following does trade NOT allow for?

Figure 3-2 -Refer to Figure 3-2.What is the opportunity cost of 1 bushel of wheat for Cliff?

Table 3-5 ​ -Refer to Table 3-5.What is the opportunity cost of one airplane for Canada?

Table 3-1 -Refer to Table 3-1.What does each producer have an absolute advantage in?

Regan grows flowers and makes vases.Jayson also grows flowers and makes vases,but Regan is better at producing both.Who has an absolute or comparative advantage in what activity?

Rusty can edit two pages in one minute,and can type 80 words in one minute.Emily can edit one page in one minute,and can type 100 words in one minute.Rusty has an absolute and comparative advantage in editing,and Emily has an absolute and comparative advantage in typing.

Table 3-6 ​ -Refer to Table 3-5.Denmark and Italy trade according to the principle of comparative advantage.If the international price of bread is 2.5 units of cheese for 1 unit of bread,what is the gain from trade to Italy per unit of bread traded?

Table 3-4 ​ -Refer to the table.Who has an absolute advantage in the production of each good?

Table 3-5 ​ -Refer to Table 3-5.If Canada and Japan trade based on the principle of comparative advantage,what could Japan gain from exporting a car?

If there is trade,which of the following is most likely?

Table 3-5 ​ -Refer to Table 3-5.Which country has a comparative advantage in each product?

What economic concept is the most relevant when defining comparative advantage?

What is the difference between production possibilities frontiers that are bowed out and those that are linear?

Suppose a gardener produces both green beans and corn in her garden.If she must give up 15 bushels of corn to get 5 bushels of green beans,what is the opportunity cost of 1 bushel of green beans?

How does trade benefit the two parties involved?

Table 3-2 ​ -Refer to Table 3-2.How could the farmer and rancher both benefit?

Table 3-6 ​ -Refer to Table 3-5.How could Denmark and Italy benefit?

Table 3-4 ​ -Refer to the table.If Alberta and Manitoba trade based on the principle of comparative advantage,what will be exported?

Table 3-6 ​ -Refer to Table 3-6.What is the opportunity cost of one unit of cheese in Denmark?

Figure 3-5 These graphs illustrate the production possibilities available for dancing shoes to Fred and Ginger with 40 hours of labour. -Refer to Figure 3-5.What is the opportunity cost of one pair of ballet slippers for Ginger?