Question 1

The figure above shows Liz's and Joe's production possibilities for Salads and Smoothies.
-Liz has a comparative advantage in ________ and an absolute advantage in ________.

Accepted Answer

A)   smoothies only; both goods
B)   smoothies only; smoothies only
C)   both goods; both goods
D)   salads only; both goods
E)   salads only; salads only

Question 2

-Suppose India and France have the same PPF,shown in the figure above.Based on their current production points,which is France's most likely future PPF?

Accepted Answer

A)   PPF₂
B)   PPF₁
C)   PPF₀
D)   either PPF₀ or PPF₁
E)   None of the above because economic growth will not happen in India.

Question 3

On a production possibilities frontier,500 pounds of apples and 1,200 pounds of bananas can be produced while at another point on the same frontier,300 pounds of apples and 1,300 pounds of bananas can be produced.Between these points,what is the opportunity cost of producing a pound of bananas?

Accepted Answer

A)   2 pounds of bananas
B)   200 pounds of apples
C)   2 pounds of apples
D)   0.5 a pound of apples
E)   12/5 = 2.4 pounds of apples

Question 4

-The above figure shows the production possibility frontier for a country.What is the opportunity cost to move from point D to point E?

Accepted Answer

A)   6 thousand bottles of wine
B)   15 thousand bottles of wine
C)   6 tons of rice
D)   9 thousand bottles of wine
E)   Nothing, it is a free lunch.

Question 5

As technology advances,

Accepted Answer

A)   all opportunity costs decrease.
B)   the PPF shifts outward.
C)   a country moves toward the midpoint along its PPF and can produce more of both goods.
D)   all opportunity costs increase.
E)   the PPF shifts inward because unemployment occurs.

Question 6

Moving from one point to another on a production possibilities frontier implies

Accepted Answer

A)   increasing the production of both goods.
B)   decreasing the production of both goods.
C)   increasing the production of one good and decreasing the production of another.
D)   holding the production levels of both goods constant.
E)   changing the amount of factors of production that are employed.

Question 7

Potatoes  (pounds)   Tomatoes  (pounds)   Huey 12 or 8 Steve 6 or 2\begin{array} { l | c c c } & \begin{array} { l } 	ext { Potatoes } \	ext { (pounds)  }\end{array} & \begin{array} { c }  	ext { Tomatoes } \	ext { (pounds)  }\end{array} \\hline 	ext { Huey } & 12 & 	ext { or } & 8 \	ext { Steve } & 6 & 	ext { or } & 2\end{array} Huey  Steve ​ Potatoes  (pounds)  ​126​ Tomatoes  (pounds)  ​ or  or ​82​​ 
-Huey and Steve can grow potatoes or tomatoes.The table above shows the pounds of potatoes and tomatoes Huey and Steve can grow in a week.Based on the table,Huey's opportunity cost of producing one pound of tomatoes is

Accepted Answer

A)   1.5 pounds of potatoes.
B)   0.66 pound of potatoes.
C)   0, because he has an absolute advantage in it.
D)   0, because he has a comparative advantage in it.
E)   1.0 pound of potatoes.

Question 8

Scott and Cindy both produce only pizza and tacos.In one hour,Scott can produce 20 pizzas or 40 tacos.In one hour,Cindy can produce 30 pizzas or 40 tacos.Based on these data,

Accepted Answer

A)   Cindy has a comparative advantage at producing tacos.
B)   Scott has a comparative advantage at producing tacos.
C)   Cindy and Scott have the same comparative advantage in producing tacos.
D)   neither Cindy nor Scott has a comparative advantage in producing tacos.
E)   Cindy and Scott have the same comparative advantage in producing pizzas.

Question 9

The production possibilities frontier is a graph showing the

Accepted Answer

A)   exact point of greatest efficiency for producing goods and services.
B)   tradeoff between free lunches.
C)   maximum combinations of goods and services that can be produced.
D)   minimum combinations of goods and services that can be produced.
E)   resources available for the economy's production use.

Question 10

-Suppose India and France have the same PPF,shown in the figure above.Based on their current production points,which is India's most likely future PPF?

Accepted Answer

A)   PPF₂
B)   PPF₁
C)   PPF₀
D)   either PPF₀ or PPF₁
E)   None of the above because economic growth will not happen in India.

Question 11

-The figure above illustrates a small country's production possibilities frontier.Moving from point C to point B,the per unit opportunity cost of computers is ________ per computer.

Accepted Answer

A)   4 tablets
B)   5/4 of a tablet
C)   4/5 of a tablet
D)   1/4 of a tablet
E)   1 computer

Question 12

A country produces only cans of soup and ink pens.If the country produces on its bowed outward PPF and increases the production of cans of soup,the opportunity cost of additional

Accepted Answer

A)   cans of soup is increasing.
B)   cans of soup is decreasing.
C)   cans of soup remains unchanged.
D)   ink pens is increasing.
E)   More information is needed to determine what happens to the opportunity cost.

Question 13

The production possibilities frontier is a boundary that separates

Accepted Answer

A)   the combinations of goods that can be produced from the combinations of services.
B)   attainable combinations of goods and services that can be produced from unattainable ones.
C)   equitable combinations of goods and services that can be produced from inequitable ones.
D)   fair combinations of goods and services that can be consumed from unfair ones.
E)   affordable production points from unaffordable points.

Question 14

-The above figure shows the production possibility frontier for an economy.The point or points that are attainable are

Accepted Answer

A)   points B and C.
B)   points A, B, and C.
C)   point E.
D)   points A, B, C, and D.
E)   points A and D.

Question 15

-Suppose Puerto Rico and Hawaii currently have the same production possibilities so that the above figure is the PPF for hotels and consumption goods in the two areas.Hotels are a capital good that,once built,will help produce still more consumption goods.If Puerto Rico produces more hotels than Hawaii,

Accepted Answer

A)   Hawaii's PPF will shift outward further than Puerto Rico's PPF.
B)   Hawaii's PPF will shift inward.
C)   Puerto Rico's PPF will not shift.
D)   Puerto Rico's and Hawaii's PPF will shift outward by the same amount.
E)   Puerto Rico's PPF will shift outward further than Hawaii's PPF.

Question 16

-The figure above shows the production possibilities frontier for a country.The opportunity cost of a gallon of milk between combination point A and B is

Accepted Answer

A)   4 gallons of ice cream for a gallon of milk.
B)   3 gallons of ice cream for a gallon of milk.
C)   1 gallon of ice cream for a gallon of milk.
D)   1/3 of a gallon of ice cream for a gallon of milk.
E)   zero because at point A zero milk is being produced.

Question 17

Japan can use all of its resources to produce 100 videos or 400 shoes.China can use all of its resources to produce 25 videos or 200 shoes.Which nation has the comparative advantage in shoes and which nation has the comparative advantage in videos?

Accepted Answer

In Japan,the opportunity cost of produci...

Question 18

-The figure above shows the production possibilities frontier for a country.In order for it to move from producing at point A to producing at point B,the country would need to incur an opportunity cost of

Accepted Answer

A)   1 million SUVs.
B)   3 million SUVs.
C)   4 million SUVs.
D)   3 million compact cars.
E)   0 because the gain in compact cars exceeds the loss in SUVs.

Question 19

$\begin{array}{c}
\begin{array}{lc}
\text { Nation A's production in } 1 \text { day } \
\hline \text { Computers } & 100 \
\text { Software } & 140
\end{array}
\begin{array}{lc}
\text { Nation B's production in } 1 \text { day } \
\hline \text { Computers } & 120 \
\text { Software } & 150 
\end{array}
\end{array}$
-Two nations can produce computers and software in the amounts given in the table above.Does either nation have an absolute advantage in producing the products? Which nation has a comparative advantage in computers? Which nation has a comparative advantage in software? Explain your answers.

Accepted Answer

Nation B has an absolute advantage in pr...

Question 20

Possibility  Capital goods  Consumption goods  A 060 B 255 C 445 D 625 E 80\begin{array} { c c c } \hline 	ext { Possibility } & 	ext { Capital goods } & 	ext { Consumption goods } \\hline 	ext { A } & 0 & 60 \	ext { B } & 2 & 55 \	ext { C } & 4 & 45 \	ext { D } & 6 & 25 \	ext { E } & 8 & 0\end{array} Possibility  A  B  C  D  E ​ Capital goods 02468​ Consumption goods 605545250​​ 
-The table above presents the production possibilities frontier for a nation.Using the information in the table,moving from possibility C to B means that

Accepted Answer

A)   4 units of capital goods are given up to get 55 units of consumption goods.
B)   2 units of capital goods are given up to get 55 additional units of consumption goods.
C)   4 units of capital goods are given up to get 10 additional units of consumption goods.
D)   4 units of capital goods are given up to get 45 units of consumption goods.
E)   2 units of capital goods are given up to get 10 additional units of consumption goods.

Exam 3: The Economic Problem

The figure above shows Liz's and Joe's production possibilities for Salads and Smoothies. -Liz has a comparative advantage in and an absolute advantage in .

Correct Answer
verified

A country produces only cans of soup and ink pens.If the country produces on its bowed outward PPF and increases the production of cans of soup,the opportunity cost of additional

Correct Answer
verified

Scott and Cindy both produce only pizza and tacos.In one hour,Scott can produce 20 pizzas or 40 tacos.In one hour,Cindy can produce 30 pizzas or 40 tacos.Based on these data,

Correct Answer
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Correct Answer
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-The figure above shows the production possibilities frontier for a country.The opportunity cost of a gallon of milk between combination point A and B is

Correct Answer
verified

-Suppose India and France have the same PPF,shown in the figure above.Based on their current production points,which is France's most likely future PPF?

Correct Answer
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On a production possibilities frontier,500 pounds of apples and 1,200 pounds of bananas can be produced while at another point on the same frontier,300 pounds of apples and 1,300 pounds of bananas can be produced.Between these points,what is the opportunity cost of producing a pound of bananas?

Correct Answer
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-Suppose India and France have the same PPF,shown in the figure above.Based on their current production points,which is India's most likely future PPF?

Correct Answer
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Correct Answer
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Nation B has an absolute advantage in pr...
View Answer

Correct Answer
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The production possibilities frontier is a boundary that separates

Correct Answer
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-The above figure shows the production possibility frontier for a country.What is the opportunity cost to move from point D to point E?

Correct Answer
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-The figure above shows the production possibilities frontier for a country.In order for it to move from producing at point A to producing at point B,the country would need to incur an opportunity cost of

Correct Answer
verified

As technology advances,

Correct Answer
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-The above figure shows the production possibility frontier for an economy.The point or points that are attainable are

Correct Answer
verified

-The figure above illustrates a small country's production possibilities frontier.Moving from point C to point B,the per unit opportunity cost of computers is ________ per computer.

Correct Answer
verified

Japan can use all of its resources to produce 100 videos or 400 shoes.China can use all of its resources to produce 25 videos or 200 shoes.Which nation has the comparative advantage in shoes and which nation has the comparative advantage in videos?

Correct Answer
verified
In Japan,the opportunity cost of produci...
View Answer

Moving from one point to another on a production possibilities frontier implies

Correct Answer
verified

The production possibilities frontier is a graph showing the

Correct Answer
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Correct Answer
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Exam 3: The Economic Problem

The figure above shows Liz's and Joe's production possibilities for Salads and Smoothies. -Liz has a comparative advantage in ________ and an absolute advantage in ________.

Correct AnswerverifiedShow Answer

A country produces only cans of soup and ink pens.If the country produces on its bowed outward PPF and increases the production of cans of soup,the opportunity cost of additional

Correct AnswerverifiedShow Answer

Scott and Cindy both produce only pizza and tacos.In one hour,Scott can produce 20 pizzas or 40 tacos.In one hour,Cindy can produce 30 pizzas or 40 tacos.Based on these data,

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

-The figure above shows the production possibilities frontier for a country.The opportunity cost of a gallon of milk between combination point A and B is

Correct AnswerverifiedShow Answer

-Suppose India and France have the same PPF,shown in the figure above.Based on their current production points,which is France's most likely future PPF?

Correct AnswerverifiedShow Answer

On a production possibilities frontier,500 pounds of apples and 1,200 pounds of bananas can be produced while at another point on the same frontier,300 pounds of apples and 1,300 pounds of bananas can be produced.Between these points,what is the opportunity cost of producing a pound of bananas?

Correct AnswerverifiedShow Answer

-Suppose India and France have the same PPF,shown in the figure above.Based on their current production points,which is India's most likely future PPF?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedNation B has an absolute advantage in pr...View AnswerShow Answer

Correct AnswerverifiedShow Answer

The production possibilities frontier is a boundary that separates

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-The above figure shows the production possibility frontier for a country.What is the opportunity cost to move from point D to point E?

Correct AnswerverifiedShow Answer

-The figure above shows the production possibilities frontier for a country.In order for it to move from producing at point A to producing at point B,the country would need to incur an opportunity cost of

Correct AnswerverifiedShow Answer

As technology advances,

Correct AnswerverifiedShow Answer

-The above figure shows the production possibility frontier for an economy.The point or points that are attainable are

Correct AnswerverifiedShow Answer

-The figure above illustrates a small country's production possibilities frontier.Moving from point C to point B,the per unit opportunity cost of computers is ________ per computer.

Correct AnswerverifiedShow Answer

Japan can use all of its resources to produce 100 videos or 400 shoes.China can use all of its resources to produce 25 videos or 200 shoes.Which nation has the comparative advantage in shoes and which nation has the comparative advantage in videos?

Correct AnswerverifiedIn Japan,the opportunity cost of produci...View AnswerShow Answer

Moving from one point to another on a production possibilities frontier implies

Correct AnswerverifiedShow Answer

The production possibilities frontier is a graph showing the

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The figure above shows Liz's and Joe's production possibilities for Salads and Smoothies. -Liz has a comparative advantage in and an absolute advantage in .

Correct Answer
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Nation B has an absolute advantage in pr...
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In Japan,the opportunity cost of produci...
View Answer

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