Chapter 3

Refer to Table 3-6. Which of the following points is on Max's production possibilities frontier, based on a 36-hour production period? Group of answer choices

(18 mittens, 0 hats)

Refer to Figure 3-3. If Tanek and Barb both spend all of their time producing burritos, then total production is

0 tacos and 500 burritos.

Refer to Figure 3-3. If the production possibilities frontier shown for Tanek is for 120 hours of production, then how long does it take Tanek to make one burrito?

0.4 hour

Nick and Tabitha are two woodworkers who both make tables and chairs. In one month, Nick can make 9 tables or 27 chairs, whereas Tabitha can make 16 tables or 48 chairs. Given this, we know that the opportunity cost of 1 chair is

1/3 table for Nick and 1/3 table for Tabitha.

Refer to Table 3-2. Assume that England and France each has 40 labor hours available. If each country devotes 10 to production of bread and 30 to production of lemonade, then total production is

12 units of bread and 22.5 units of lemonade.

Suppose that a worker in Caninia can produce either 2 blankets or 8 meals per day, and a worker in Felinia can produce either 5 blankets or 1 meal per day. Each nation has 10 workers. For many years, the two countries traded, each completely specializing according to their respective comparative advantages. Now war has broken out between them and all trade has stopped. Without trade, Caninia produces and consumes 10 blankets and 40 meals per day and Felinia produces and consumes 25 blankets and 5 meals per day. The war has caused the combined daily output of the two countries to decline by

15 blankets and 35 meals.

Refer to Table 3-11. Cuba and Denmark would not be able to gain from trade if Denmark's opportunity cost of one radio changed to

2 coolers.

Refer to Figure 3-2. If the production possibilities frontier shown is for 32 hours of production, then how long does it take Peru to make one pound of cashews?

2/15 hour

Refer to Table 3-10. What is Teresa's opportunity cost of producing one bushel of wheat?

3/5 pounds of beef

Refer to Figure 3-5. Suppose Peru decides to increase its production of emeralds by 1. What is the opportunity cost of this decision?

30 rubies

Refer to Figure 3-4. If Jane produces only pizzas, she can produce

300 pies per day.

Suppose that a worker in Cornland can grow either 40 bushels of corn or 10 bushels of oats per year, and a worker in Oatland can grow either 5 bushels of corn or 50 bushels of oats per year. There are 20 workers in Cornland and 20 workers in Oatland. If the two countries do not trade, Cornland will produce and consume 400 bushels of corn and 100 bushels of oats, while Oatland will produce and consume 20 bushels of corn and 800 bushels of oats. If each country made the decision to specialize in producing the good in which it has a comparative advantage, then the combined yearly output of the two countries would increase by

380 bushels of corn and 100 bushels of oats

Refer to Table 3-2. Which of the following illustrates the amounts of bread and lemonade France could produce in 20 hours?

4 units of bread or 10 units of lemonade

Refer to Figure 3-3. Tanek's opportunity cost of one burrito is

4/3 tacos and Barb's opportunity cost of one burrito is 2 tacos.

Suppose that a worker in Radioland can produce either 5 radios or 1 television per year, and a worker in Teeveeland can produce either 1 radios or 5 televisions per year. Each nation has 100 workers. Also, suppose that each country completely specializes in producing the good in which it has a comparative advantage. If Radioland trades 50 radios to Teeveeland in exchange for 50 televisions each year, then each country's maximum consumption of new radios and televisions per year will be

450 radios, 50 televisions in Radioland and 50 radios, 450 televisions in Teeveeland.

Refer to Table 3-4. Which of the following combinations of toothbrushes and hairbrushes could Zimbabwe not produce in 120 minutes?

5 toothbrushes and 11 hairbrushes

Refer to Table 3-8. If the production possibilities frontier is bowed outward, then how many coats are produced when 8 blankets are produced?

50

Refer to Figure 3-3. If Tanek must work 0.2 hour to produce each taco, then his production possibilities frontier is based on how many hours of work?

80 hours

Refer to Table 3-9. The values in the table represent the amounts of lemonade and pizzas that Alice and Betty can produce in one week without and with specialization and trade. What are Alice and Betty's gains from specialization and trade?

Alice gains 9 pitchers of lemonade and 13 pizzas, while Betty gains 12 pitchers of lemonade and 8 pizzas.

Refer to Figure 3-4. If point A represents Alvina's current production and point B represents Jane's current production, under what circumstances can both Alvina and Jane benefit from specialization and trade? Group of answer choices

Alvina produces more lemonade and Jane produces more pizzas.

If China is capable of producing either shoes or toy trains or some combination of the two, then

China's opportunity cost of shoes is the inverse of its opportunity cost of toy trains.

Refer to Figure 3-1. The rate of trade-off between producing chairs and producing couches depends on how many chairs and couches are being produced in

Graph (a) only.

The principle of comparative advantage does not provide answers to certain questions. One of those questions is

How are the gains from trade shared among the parties to a trade?

If Mike can produce more donuts in one day than Sue can produce in one day, then

Mike has an absolute advantage in the production of donuts.

Consider two individuals, Tanek and Kalene each of whom knits sweaters and makes hotdogs, respectively. The gains from trade between Tanek and Kalene are most obvious in which of the following cases?

Tanek's skills are such that he can only knit sweaters, and Kalene's skills are such that she can only make hotdogs.

Which of the following is not correct?

The gains from specialization and trade are based not on comparative advantage but on absolute advantage.

The gains from trade are

a result of more efficient resource allocation than would be observed in the absence of trade.

Both Ryan and Sachi produce ankle bracelets and rings. However, Ryan is better at producing both goods. In this case, trade could

benefit both Sachi and Ryan.

Total output in an economy increases when each person specializes because

each person spends more time producing that product in which he or she has a comparative advantage.

The producer that requires a smaller quantity of inputs to produce a certain amount of a good, relative to the quantities of inputs required by other producers to produce the same amount of that good,

has an absolute advantage in the production of that good.

A popular celebrity that is paid highly for her time should probably not mow her own lawn because

her opportunity cost of mowing her lawn is higher than the cost of paying someone to mow it for her.

Suppose the United States has a comparative advantage over Mexico in producing pork. The principle of comparative advantage asserts that

in order to consume beyond its PPF, the United States should produce more pork than what it requires and export some of it to Mexico.

Absolute advantage is found by comparing different producers'

input requirements per unit of output.

A professor spends 8 hours per day giving lectures and writing papers. For the professor, a graph that shows his various possible mixes of output (lectures given per day and papers written per day) is called his

production possibilitiesfrontier.

As a student, Jordyn spends 40 hours per week writing term papers and completing homework assignments. On one axis of her production possibilities frontier is measured the number of term papers written per week. On the other axis is measured the number of homework assignments completed per week. Jordyn's production possibilities frontier is a straight line if

she can switch between writing term papers and completing homework assignments at a constant rate.

The production possibilities frontier illustrates

the combinations of output that an economy can produce

Suppose there are only two people in the world. Each person's production possibilities frontier also represents his or her consumption possibilities when

they choose not to trade with one another.

The opportunity cost of an item is

what you give up to get that item.