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Exam 3: Interdependence and the Gains From Trade

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Question 151

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Use the following Table to answer the question : Table 3-41 -Refer to Table 3-41. Which country has a comparative advantage in producing radios?

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Question 152

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If Iowa's opportunity cost of corn is lower than Oklahoma's opportunity cost of corn, then

A) Iowa has a comparative advantage in the production of corn.
B) Iowa has an absolute advantage in the production of corn.
C) Iowa should import corn from Oklahoma.
D) Oklahoma should produce just enough corn to satisfy its own residents' demands.

E) A) and D)
F) A) and C)

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Question 153

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What must be given up to obtain an item is called

Use the following Table to answer the question : Table 3-23 Assume that the farmer and the rancher can switch between producing pork and producing tomatoes at a constant rate. -Refer to Table 3-23. The farmer has a comparative advantage in the production of

Use the following scenario to answer the question : Scenario 3-1 The production possibilities frontiers below show how much Greg and Catherine can each produce in 8 hours of time. Greg's Production Possibilities Catherine's Production Possibilities -Refer to Scenario 3-1. What is Greg's opportunity cost of producing ice cream? Explain how you derived your answer.

Use the following Figure to answer the question : Figure 3-16 Hosne's Production Possibilities Frontier Merve's Production Possibilities Frontier -Refer to Figure 3-16. If Hosne and Merve switch from each person dividing her time equally between the production of purses and wallets to each person spending all of her time producing the good in which she has a comparative advantage, then total production of purses will increase by

Use the following Table to answer the question : Table 3-34 Assume that Indonesia and India can switch between producing rice and bananas at a constant rate. -Refer to Table 3-34. For which goods) does Indonesia have a comparative advantage

Use the following Figure to answer the question : Figure 3-26 Mary's Production Possibilities Frontier Kate's Production Possibilities Frontier -Refer to Figure 3-26. Who has a comparative advantage in making muffins?

The gains from trade are

Use the following Table to answer the question : Table 3-24 Assume that England and Spain can switch between producing cheese and producing bread at a constant rate. -Refer to Table 3-24. If England and Spain each spends all its time producing the good in which it has a comparative advantage and the countries agree to trade 2 units of bread for 6 units of cheese, then England will consume

Use the following Figure to answer the question :Figure 3-7 Bintu's Production Possibilities Frontier Juba's Production Possibilities Frontier -Refer to Figure 3-7. If the production possibilities frontier shown for Juba is for 2 hours of work, then how long does it take Juba to make one bowl?

Tom produces baseball gloves and baseball bats. Steve also produces baseball gloves and baseball bats, but Tom is better at producing both goods. In this case, trade could

Use the following Figure to answer the question : Figure 3-26 Mary's Production Possibilities Frontier Kate's Production Possibilities Frontier -Refer to Figure 3-26. If Mary and Kate trade foods with each other, who will trade away muffins in exchange for cookies?

Use the following Figure to answer the question : Figure 3-22 Alice and Betty's Production Possibilities in one 8­hour day. Alice's Production Possibilities Frontier Betty's Production Possibilities Frontier -Refer to Figure 3-22. What are Alice and Betty's opportunity costs of 1 pizza?

A farmer has the ability to grow either corn or cotton or some combination of the two. Given no other information, it follows that the farmer's opportunity cost of a bushel of corn multiplied by his opportunity cost of a bushel of cotton

As long as two people have different opportunity costs, each can gain from trade with the other, since trade allows each person to obtain a good at a price lower than his or her opportunity cost.

Use the following Table to answer the question : Table 3-36 -Refer to Table 3-36. Antigua has a comparative advantage in the production of

Use the following Table to answer the question : Table 3-23 Assume that the farmer and the rancher can switch between producing pork and producing tomatoes at a constant rate. -Refer to Table 3-23. The opportunity cost of 1 pound of tomatoes for the farmer is

Use the following Figure to answer the question : Figure 3-18 Bintu's Production Possibilities Frontier Juba's Production Possibilities Frontier -Refer to Figure 3-18. The opportunity cost of 1 cup for Juba is

Use the following Figure to answer the question :Figure 3-7 Bintu's Production Possibilities Frontier Juba's Production Possibilities Frontier -Refer to Figure 3-7. If Bintu must work 2 hours to make each cup, then her production possibilities frontier is based on how many hours of work?