Tom and Jerry have one day to work, but two tasks to focus on: building chairs and tables. If Tom spends all day building chairs, he will make 16 chairs. If he instead devotes his day to building tables, Tom will make 4 tables. If Jerry spends his day building chairs, he will make 14 chairs; if he spends the day building tables, he will make 7 tables. Based on their production possibilities frontiers, Tom and Jerry:

Multiple Choice

can both benefit from trade because absolute advantage exists.

can both benefit from trade because comparative advantage exists.

will decide not to trade because no comparative advantage exists.

cannot benefit from trade because Tom has an absolute advantage at producing both goods.

Item2

0.28points

Item2

Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. The opportunity cost of a truck in Country A is:

Suppose that a worker in Country A can produce either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can produce either 18 bananas or 6 tomatoes each year. Country B has 400 workers. Country B specializes in producing tomatoes and Country A specializes in producing bananas. What terms of trade would both countries be willing to agree to?

Multiple Choice

One tomato for six bananas

One tomato for one banana

One tomato for four bananas

One tomato for two bananas

One tomato for six bananas

One tomato for one banana

One tomato for four bananas

One tomato for two bananas

Consider the production possibilities frontier displayed in the figure shown. The opportunity cost of a bushel of apples is:

Multiple Choice

Consider the production possibilities frontier displayed in the figure shown. The opportunity cost of one watermelon:

Multiple Choice

is zero at point C.

will decrease as more watermelons are produced.

is constant.

will increase as more watermelons are produced.

Consider the production possibilities frontier displayed in the figure shown. The opportunity cost of one bushel of wheat is:

30 computers.

6 computers.

5 computers.

1/5 computers.

Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. Which of the following statements is true regarding Country A's opportunity cost of a t-shirt?

Multiple Choice

It is higher than that of Country B for both goods, so Country A will not benefit from trade.

It is lower than that of Country B for both goods, so Country A will not benefit from trade.

It is higher than that of Country B, so Country A should specialize in avocados and trade for t-shirts.

It is lower than that of Country B, so Country A should specialize in t-shirts and trade for avocados.

8

0.48points

Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. Which of the following statements is true?

I.Country A has an absolute advantage at producing both avocados and t-shirts.

II.Country B has a comparative advantage at producing t-shirts.

III.Country B would benefit from trade, but Country A would not.

Multiple Choice

I and II only

III only

I only

II and III only

\

Suppose that a worker in Country A can make either 10 iPhones or 5 iPads each year. Country A has 100 workers. Suppose a worker in Country B can make either 2 iPhones or 10 iPads each year. Country B has 200 workers. Which of the following is true?

Multiple Choice

In Country A, the opportunity cost of one iPhone is two iPads.

In Country B, the opportunity cost of one iPhone is two iPads.

In Country A, the opportunity cost of one iPad is two iPhones.

The opportunity cost of iPads is lower in Country A than in Country B.

Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. The opportunity cost of a truck in Country B is:

Multiple Choice

1.5 cars

12 cars.

3 cars.

4 trucks.

Suppose that a worker in Country A can produce either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can produce either 18 bananas or 6 tomatoes each year. Country B has 400 workers. The opportunity cost of one tomato is:

Multiple Choice

higher in Country A than Country B.

lower in Country A than Country B.

impossible to calculate without more information.

the same in both countries.

Suppose the figure shown represents the production possibilities frontier for Country A. Country B offers to trade four trucks for every airplane. Assuming Country A specializes in airplane production, which of the following combinations of goods could Country A consume?

Multiple Choice

(10 airplanes, 20 trucks)

(5 airplanes, 20 trucks)

(15 airplanes, 20 trucks)

(10 airplanes, 30 trucks)

Tom and Jerry have one day to work, but two tasks to focus on: building chairs and tables. If Tom spends all day building chairs, he will make 16 chairs. If he instead devotes his day to building tables, Tom will make 4 tables. If Jerry spends his day building chairs, he will make 14 chairs; if he spends the day building tables, he will make 7 tables. If Tom divides his time evenly between activities and acts efficiently, he will produce:

Multiple Choice

16 chairs and 4 tables.

12 chairs and 3 tables.

8 chairs and 2 tables.

4 chairs and 3 tables.

Tom and Jerry have one day to work, but two tasks to focus on: building chairs and tables. If Tom spends all day building chairs, he will make 16 chairs. If he instead devotes his day to building tables, Tom will make 4 tables. If Jerry spends his day building chairs, he will make 14 chairs; if he spends the day building tables, he will make 7 tables. For Tom, the opportunity cost of building a table is _______ chairs made.

Multiple Choice

8

4

16

12

Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. Considering the production possibilities frontiers of both countries, we can conclude that Country B will specialize in _____ and be willing to _____ three cars for each truck.

Multiple Choice

trucks; accept no more than

trucks; accept no fewer than

cars; give no fewer than

cars; give no more than

Consider the production possibilities frontier displayed in the figure shown. The opportunity cost of one avocado is:

Multiple Choice

2 bananas.

1.5 bananas.

2/3 bananas.

210 bananas.

Assume that the opportunity cost for Germany to produce a jet is 50 cars. If Germany is producing on its production possibilities frontier, which of the following describes possible combinations of output?

Multiple Choice

(1,000 jets, 5,000 cars) and (900 jets, 10,000 cars)

(2,500 jets, 2,000 cars) and (2,300 jets, 20,000 cars)

(2,500 jets, 2,000 cars) and (2,300 jets, 3,000 cars)

(1,000 jets, 5,000 cars) and (900 jets, 15,000 cars)

Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. The slope of Country A's production possibilities frontier:

• measures the opportunity cost of trucks in terms of cars.

measures the trade-off that Country A faces when deciding how to allocate resources.

is constant, because the opportunity cost remains constant.

All of these statements are true.

Suppose that a worker in Country A can make either 10 iPhones or 5 iPads each year. Country A has 100 workers. Suppose a worker in Country B can make either 2 iPhones or 10 iPads each year. Country B has 200 workers. Country B would be using resources efficiently if it was producing:

Multiple Choice

(200 iPhones, 750 iPads).

(200 iPhones, 1,500 iPads).

(200 iPhones, 1,000 iPads).

(200 iPhones, 1,750 iPads).

Consider the production possibilities frontier displayed in the figure shown. The opportunity cost of one watermelon is:

Multiple Choice

30 bushels of apples.

20 bushels of apples.

10 bushels of apples.

40 bushels of apples.

Tom and Jerry have one day to work, but two tasks to focus on: building chairs and tables. If Tom spends all day building chairs, he will make 16 chairs. If he instead devotes his day to building tables, Tom will make 4 tables. If Jerry spends his day building chairs, he will make 14 chairs; if he spends the day building tables, he will make 7 tables. For Jerry, the opportunity cost of building a table is _____ chairs made.

Multiple Choice

4

7

2

14

When a producer has a comparative advantage at producing a good, it means the producer:

Multiple Choice

is efficient in production.

can produce more of that good than others with the same number of workers.

has the ability to produce the good at a lower opportunity cost than others.

has no reason to trade with others.

Suppose that a worker in Country A can make either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can make either 18 bananas or 6 tomatoes each year. Country B has 400 workers. What are two possible consumption bundles that Country B could produce?

Multiple Choice

(7,200 bananas, 2,400 tomatoes) and (3,600 bananas, 1,200 tomatoes)

(1,800 bananas, 1,800 tomatoes) and (900 bananas, 2,200 tomatoes)

(7,200 bananas, 0 tomatoes) and (4,000 bananas, 1,200 tomatoes)

(3,600 bananas, 1,200 tomatoes) and (1,800 bananas, 1,600 tomatoes)

Suppose the figure shown represents the production possibilities frontier for Country A. Country B offers to give 4 TVs to Country A for every cellphone it receives. Assuming Country A fully specializes in cellphone production and that it wishes to consume 24 cellphones total, how many TVs can Country A consume after trade?

Multiple Choice

48 TVs

28 TVs

30 TVs

96 TVs

Consider the production possibilities frontier displayed in the figure shown. The opportunity cost of one scarf between points C and D is:

Multiple Choice

20 sweaters.

10 sweaters

2 sweaters.

1 sweater.

A country's newest ruler has decided the country will become self-sufficient and ceases trade with the rest of the world. How will this most likely affect the country's citizens?

Multiple Choice

They will beforced to consume less of the goods the country had a comparative advantage at producing.

They will be better off than before only if they have a comparative advantage at producing all goods.

They will be better off than before only if the country has an absolute advantage at producing most of the goods they consume.

They will be better off than before as long as the country has an absolute advantage at producing any good.

If the United States, a wealthy nation, trades with Cambodia, a poorer, less developed nation, which of the following statements is likely true?

Multiple Choice

Both the United States and Cambodia can benefit from trading.

The United States is being charitable and not benefiting from the trade at all.

The United States is taking advantage of Cambodia and is the only beneficiary to the trade.

Cambodia has been pressured to enter trade and is not benefiting at all.

Suppose the figure shown represents the production possibilities frontier for Country A. Country B offers to give 3 TVs to Country A for every cellphone it receives. Assuming Country A fully specializes in cellphone production, which of the following combinations of goods could Country A now consume that it could not achieve before trade?

Multiple Choice

(600 cellphones, 800 TVs)

(300 cellphones, 1,000 TVs)

(400 cellphones, 1,200 TVs)

(800 cellphones, 1,600 TVs)

Tom and Jerry have one day to work, but two tasks to focus on: building chairs and tables. If Tom spends all day building chairs, he will make 16 chairs. If he instead devotes his day to building tables, Tom will make 4 tables. If Jerry spends his day building chairs, he will make 14 chairs; if he spends the day building tables, he will make 7 tables. In one day, Jerry can produce:

Multiple Choice

14 chairs and 7 tables.

10 chairs and 5 tables.

6 chairs and 4 tables.

12 chairs and 6 tables.

Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. Considering the production possibilities frontiers of both countries, we can infer that Country A should specialize in producing _____ and be willing to _____ five cars for each truck.

Multiple Choice

trucks; accept no less than

trucks; accept no more than

cars; give no less than

cars; give no more than

Tom and Jerry have one day to work, but two tasks to focus on: building chairs and tables. If Tom spends all day building chairs, he will make 16 chairs. If he instead devotes his day to building tables, Tom will make 4 tables. If Jerry spends his day building chairs, he will make 14 chairs; if he spends the day building tables, he will make 7 tables. In one day, Tom can produce either:

Multiple Choice

(8 chairs, 2 tables) or (4 chairs, 3 tables).

(12 chairs, 3 tables) or (8 chairs, 3 tables).

(8 chairs, 2 tables) or (4 chairs, 6 tables).

(16 chairs, 4 tables) or (8 chairs, 2 tables).

Suppose England has a comparative advantage over the United States at producing tea. If this is true, then:

Multiple Choice

the United States has nothing to gain from buying tea produced by England.

England should produce a small amount of tea and buy the rest of the tea it wants from the United States.

England should produce more tea than it wants and sell the rest to the United States.

England should buy all of the tea it wants from the United States.

Consider the production possibilities frontier displayed in the figure shown. The opportunity cost of one scarf is largest between:

Multiple Choice

points C and D.

points A and B.

points A and D.

points B and C.

Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. After examining each country's production possibilities frontier, it is clear that:

Multiple Choice

both countries can benefit from trade because an absolute advantage exists.

only Country A will benefit from trade.

both countries could benefit from trade because a comparative advantage exists.

neither country will benefit from trade.