Gains from Trade

You pay a plumber to install a new dishwasher in your home. Which statement is FALSE? (I got this one wrong, please update it once the answer is found. ty)

***NOT***The plumber experiences gains from trade because they earned income. AND Only the plumber experiences gains from trade because they received money.

(Table: Joachim and Zane's Opportunity Cost) The table shows data on how long it takes Joachim and Zane to clean the bathrooms and wash the windows at a home. Who has a comparative advantage in washing windows? Hours it takes to: | | Clean the bathrooms | Wash the windows Joachim | 4 | 10 Zane | 3 | 6

Zane, because he has a lower opportunity cost

As long as people have different _____, everyone has a comparative advantage in something.

opportunity costs

Why does Apple design the iPhone in California but assemble the iPhone in China?

The United States has a comparative advantage in iPhone design.

Economists generally believe that a person should specialize in the production of a good or service if:

they can produce the product while forgoing fewer alternative products than any other person.

Chantelle grows tomatoes and sells them at the farmer's market. Because the price of tomatoes rises, she is encouraged to grow and sell more. This is an example of price functioning as a(n):

incentive.

During the coronavirus pandemic, global supply chain issues caused the supply of new cars to shift left. Which role did price play in the new car market? Price was a(n):

message to potential buyers that the marginal cost of manufacturing new cars is rising.

You are the manager at Pure Sweat Studio, a membership-based sauna club, assigning closing duties to your team members. In 12 minutes, Sadiquah can fold all of the clean towels needed for a sauna room for the next day's use. She can clean a sauna room in 9 minutes. Landon can fold the towels in 10 minutes or clean a room in 15 minutes. Sadiquah's opportunity cost of folding towels is _____ sauna rooms.

1.33

(Table: Cooking Time). The table provides data on how long it takes Marla and Jason to cook lasagna and chicken curry. Marla's opportunity cost of making lasagna is _____, and Jason's opportunity cost is _____. | Hours it takes to cook: | Lasagna | Chicken curry Marla | 4 | 3 Jason | 3 | 1

1.33 chicken curries; three chicken curries

You and your colleague are sales representatives. The table displays the number of minutes it takes you to perform your primary tasks. | Place a phone call | Process an application You | 7 | 11 Your colleague | 5 | 13

1; 1

Cornell can type reports faster and more accurately than Alice, so Cornell has a(n) _____ in typing reports.

absolute advantage

On camping trips, Katie is much faster than her husband, Brett, at putting up a tent and starting a fire. Who should do each task if they want to maximize their time sitting around the campfire?

They should first each focus on that task in which they have a comparative advantage. When one finishes the assigned task, they can help the other.

Which benefit could a company gain from using internal markets?

better allocation of its resources and more accurate predictions

When trade is based on comparative advantage:

both trading partners end up better off than when there is no trade.

You recently renovated a large historic building in the heart of your city to convert it into a boutique hotel, of which you're now the owner and operator. After a few months, you've noticed that the quantity of hotel bookings vary. Sometimes more rooms are booked on weekends, but sometimes certain events through the week result in a greater quantity of rooms booked. You now want to forecast when to expect the most bookings, but you don't know which events will bring the most people to the hotel. The MOST accurate forecast would likely result if you:

design an internal prediction market for employees to indicate their expectations.

Price is functioning as a message when it: -is a line of communication between buyers and sellers in a market. -creates incentives for changes in production and consumption. -broadcasts useful information. -summarizes all that is happening in the market.

is a line of communication between buyers and sellers in a market.

When a country's production mix becomes more specialized due to increased international trade based on comparative advantage:

some industries in the country will shrink and possibly disappear.

When a manager uses comparative advantage to assign tasks in a workplace, then each:

task is assigned to the worker with the lowest opportunity cost for performing the task.

A prediction market is a market where: -messages lead to future actions. -information is disaggregated. -payoffs are linked to whether an uncertain event occurs. -information is missing to make a good decision.

payoffs are linked to whether an uncertain event occurs.

You're performing a competitive analysis for Dove, a leading personal care brand in the United States. Your findings indicate a trend toward consumer preference for deodorants made with more naturally derived ingredients. Because of the high price competitors are receiving for natural deodorants, Dove follows your recommendation and enters the natural deodorant market by launching the Dove Care by Plants line. For Dove, the high price acted as a(n):

incentive.