Macro Chapter 2 & 7 Homework

Based on the previous question: ​Tom's opportunity cost of mowing lawns in terms of trimming bushes is _____________ trimmed bushes per mowed lawn.

1.60

If you are at point​ C, what is the opportunity cost of increasing your chemistry score by studying one additional hour for the chemistry​ exam?

5 fewer points on your economics exam.

What can be determined from the table?

Child has an absolute advantage in the production of hats and beer. Chile has a comparative advantage in the production of hats, and Argentina has a comparative advantage in the production of beer.

A country will always be an exporter of a good where it has a ________________ advantage in production.

Comparative

________________ advantage is the ability of an​ individual, a​ firm, or a country to produce a good or service at a lower opportunity cost than competitors. While ______________ advantage is the ability of an​ individual, a​ firm, or a country to produce more of a good or service than competitors when using the same amount of resources.

Comparative; Absolute

What can be determined from the table?

Country A has an absolute advantage in the production of both goods and a comparative advantage in the production of food.

Consider the production possibilities frontier that shows the​ trade-off between the production of cotton and the production of soybeans depicted in the figure. What effect would genetic modification that makes cotton resistant to​ insects, allowing yields to increase have on the initial PPF?

Quantity of cotton shifts upwards.

Consider the production possibilities frontier ​(PPF​) that shows the​ trade-off between the production of cotton and the production of soybeans depicted in the figure. What effect would a prolonged drought have on the initial PPF?

Shift Inwards

Based on the previous question: Which of the following statements is true for Tazania with​ trade?

With trade, Tanzania is producing on its PPF but not consuming on its PPF.