Using FACT #1, what is Ross's opportunity cost of producing 1 clay pot? What is Ross's opportunity cost of producing 1 garden gnome?

A) 8 garden gnomes;

1 8 clay pots.

B)

1 8 garden gnomes; 8 clay pots. C) 2 garden gnomes; 1 2 clay pots. D) 1 2 garden gnomes; 2 clay pots.

7.Using FACT #1, what is Rachel's opportunity cost of producing 1 clay pot? What is Rachel's opportunity cost of producing 1 garden gnome?

A) 8 garden gnomes;

1 8 clay pots.

B)

1 8 garden gnomes; 8 clay pots. C) 2 garden gnomes; 1 2 clay pots. D) 1 2 garden gnomes; 2 clay pots.

8. Using FACT #1, who has the comparative advantage in producing garden gnomes? Who has the comparative advantage in producing clay pots?

A) Ross; Rachel. B) Ross; Ross. C) Rachel; Ross. D) Rachel; Rachel.

9.Using FACT #1, what are the overall net gains from specialization and trade?

A) 16 clay pots and 40 garden gnomes. B) 4 clay pots and 4 garden gnomes. C) 8 clay pots and 4 garden gnomes. D) 8 clay pots and 20 garden gnomes.

Ross and Rachel produce clay pots and garden gnomes. The first table shows Ross's production possibilities and the second table shows Rachel's production possibilities. Each week, Ross produces 4 clay pots and 32 garden gnomes and Rachel produces 8 clay pots and 4 garden gnomes. Ross's Production Possibilities Clay Pots (per week) Garden Gnomes (per week) 20 0 16 8 12 16 8 24 4 32 0 40 Rachel's Production Possibilities Clay Pots (per week) Garden Gnomes (per week) 16 0 8 4 O 8