Exam 4 Econ

Does either China or South Korea have an absolute advantage and if so, in what product?

South Korea has an absolute advatange in both products

What happenes to absolute value of the marginal rate of subsitution as you move down a convex (bowed toward the origin ) indifference curve

it decrease

(b) I only eat grape jelly and never eat grape jam

straigtht line curve

if Tanisha can audit more tax returns in one hour than libby, then Tanisha has an absolute advantage in auduiting tax returns

true

the basis for trade is comparative advantage , not absolute advatnage

true

chona has a comparative advantage in the production of

wheat

If a country produces only two goods then it is not possible to have an absoulte adavnatge in the production of both goods

false it can have a lower oppourinty cost than another

In a two- good two country world, if one ocuntry has an absoltue adaatange in production of both goods, it cannot benefit by tading with the other country

false, they can always benefit from trade

What is South Korea's opportunity cost of producing one digital camera

20 pounds of wheat

what is chinas opportunity coast of producing one digital camera

25 pounds of wheat

suppose the price of pilates sessions rise to $30 while income and the price of Yoga session remain unchanged . the substitution effect this price change is represented by the movment from

A to D

Suppose the price of Pilates sessions rise to $30 while income and the price of Yoga sessions unchanged . The income effect of this price change is represented by the movement from

D to C

in a two, two country world if one country has absolute in the production of both goods, it mist also have a compartive advatnage in the production of both goods

False

For each surfboard that Australia produces, it gives up the opportunity to make 25 boomerangs. New Zealand can produce 1 surfboard for every 15 boomerangs it produces. Which of the following is true about the comparative advantage between the two countries?

New Zealand has the comparative advantage in producing surfboards and boomerangs

for a peron to have a comparative adavantage in producing a product , she must be able to produce that product at a lower opportunity cost than her competitors

True

Suppose the price of pilates sessions rises to $30 while income and the price of Yoga sessions remain unchanged. What is her new optimal bundle

bundle C

(c) I always take iced tea with sugar

dialong curve

(a) I cannot taste the difference between grape jelly and grape jam, but I like them both

c- curve

if the two countreis specialize and trade, who should export wheat?

china