Question 1

Use the following to answer questions : 
-(Table: Comparative Advantage I) Look at the table Comparative Advantage I. The opportunity cost of producing 1 box of cell phones for Sweden is _____ box(es) of herring.

Accepted Answer

The answer of Use the following to answer questions :...

Question 2

Trade can be beneficial to an economy because:

Accepted Answer

Trade allows countries to focus on producing the goods and services in which they have a comparative advantage, meaning they can produce them at a lower opportunity cost than other countries. This leads to increased efficiency and allows countries to obtain more goods and services than they could produce on their own, thereby benefiting the economy. Option A is partially correct, as trade may not result in more efficiency for all trading countries, but it does for those specializing in areas of comparative advantage. Option C is incorrect, as specialization in activities in which countries have a comparative advantage is actually beneficial for the economy. Option D is also incorrect, as trade may not directly prevent unemployment, although it can indirectly lead to job creation in certain industries.

Question 3

An economy that has the lowest opportunity cost of producing a particular good is said to have:

Accepted Answer

The concept of comparative advantage refers to the ability of an economy to produce a particular good at a lower opportunity cost than another economy. Therefore, an economy that has the lowest opportunity cost of producing a particular good has a comparative advantage in the production of that good.

Question 4

Use the following to answer questions : 
-(Table: Comparative Advantage I) Look at the table Comparative Advantage I. The opportunity cost of producing 1 box of herring for Sweden is _____ box(es) of cell phones.

Accepted Answer

The answer of Use the following to answer questions :...

Question 5

If the opportunity cost of manufacturing machinery is higher in the United States than in Britain and the opportunity cost of manufacturing sweaters is lower in the United States than in Britain, then the United States will:

Accepted Answer

The United States has a comparative advantage in manufacturing sweaters due to the lower opportunity cost. Therefore, it should export sweaters to Britain. On the other hand, since the opportunity cost of manufacturing machinery is higher in the United States, it should import machinery from Britain, which has a comparative advantage in this field. Therefore, the best choice is to export sweaters to Britain and import machinery from Britain.

Question 6

The concept of comparative advantage is based upon:

Accepted Answer

Comparative advantage is based upon relative opportunity costs, which refers to the opportunity cost of producing one good in terms of the forgone production of another good. In other words, a country has a comparative advantage in producing a good if it can produce that good at a lower opportunity cost than another country. This allows both countries to specialize in producing the goods in which they have a comparative advantage and trade with one another, resulting in greater efficiency and welfare gains for both countries.

Question 7

Use the following to answer questions : 
-(Table: Comparative Advantage I) Look at the table Comparative Advantage I. Finland has an absolute advantage in producing:

Accepted Answer

The answer of Use the following to answer questions :...

Question 8

Use the following to answer questions : 
-(Table: Comparative Advantage I) Look at the table Comparative Advantage I. Sweden has a comparative advantage in producing:

Accepted Answer

The table shows that Sweden has a lower opportunity cost for producing herring compared to Germany. Therefore, Sweden has a comparative advantage in producing herring. There is no information given on cell phone production, so we cannot determine if Sweden has a comparative advantage in producing cell phones.

Question 9

Use the following to answer questions : 
-(Table: Comparative Advantage I) Look at the table Comparative Advantage I. The opportunity cost of producing 1 box of cell phones for Finland is _____ box(es) of herring.

Accepted Answer

Finland's opportunity cost of producing 1 box of cell phones is 5 boxes of herring. However, the opportunity cost of producing 1 box of herring for Finland is only 2/3 of a box of cell phones, which is less than the opportunity cost for Japan (1 box of cell phones) and thus Finland has a comparative advantage in producing herring. Therefore, Finland should specialize in producing herring and trade with Japan for cell phones.

Question 10

Use the following to answer questions : 
-(Table: Comparative Advantage I) Look at the table Comparative Advantage I. Finland has a comparative advantage in producing:

Accepted Answer

Finland has a comparative advantage in producing cell phones if it can produce them at a lower opportunity cost than herring compared to other countries.

Question 11

Use the following to answer questions : 
-(Table: Coffee and Salmon Production Possibilities II) Look at the table Coffee and Salmon Production Possibilities II. This table shows the maximum amounts of coffee and salmon, both measured in pounds, that Brazil and Alaska can produce if they just produce one good. Alaska has an absolute advantage in producing:

Accepted Answer

The answer of Use the following to answer questions :...

Question 12

An economy is said to have a comparative advantage in the production of one good if it:

Accepted Answer

Comparative advantage is the ability of an economy to produce a particular good at a lower opportunity cost than another economy. Therefore, an economy has a comparative advantage in the production of a particular good if it has the lowest opportunity cost of producing that good. Thus, option D is the correct answer.

Question 13

Use the following to answer questions : 
-(Table: Comparative Advantage I) Look at the table Comparative Advantage I. Sweden has an absolute advantage in producing:

Accepted Answer

Sweden has a lower opportunity cost of producing herring (2/3 cell phones) compared to Germany (3/4 cell phones), indicating a comparative advantage in producing herring. However, Sweden has a higher opportunity cost of producing cell phones (3/2 herring) compared to Germany (4/3 herring), indicating a comparative disadvantage in producing cell phones. Therefore, Sweden has an absolute advantage in producing neither cell phones nor herring.

Question 14

If Brazil gives up three automobiles for each ton of coffee it produces, while Peru gives up seven automobiles for each ton of coffee it produces, then Brazil has a comparative advantage in _____ production and should specialize in _____.

Accepted Answer

coffee;coffeeBrazil has a lower opportunity cost in producing coffee compared to Peru (giving up 3 automobiles vs. 7 automobiles for each ton of coffee), indicating Brazil has a comparative advantage in coffee production. Therefore, Brazil should specialize in coffee.

Question 15

An economy is said to have a comparative advantage in the production of a good if it can produce that good:

Accepted Answer

Comparative advantage means that an economy can produce a good at a lower opportunity cost than another economy. This means that the economy can produce the good more efficiently, using fewer resources, or sacrificing fewer alternative goods. Option A is incorrect because having more resources does not necessarily mean that an economy has a comparative advantage in producing a good. Option B is incorrect because having a higher opportunity cost would mean that an economy is less efficient in producing the good, which would indicate a comparative disadvantage. Option C is incorrect because producing outside the production possibility frontier is impossible due to limited resources.

Question 16

Use the following to answer questions : 
-(Table: Coffee and Salmon Production Possibilities II) Look at the table Coffee and Salmon Production Possibilities II. This table shows the maximum amounts of coffee and salmon, both measured in pounds, that Brazil and Alaska can produce if they just produce one good. Brazil has a comparative advantage in producing:

Accepted Answer

Brazil has a lower opportunity cost in producing coffee compared to Alaska, meaning they can produce coffee more efficiently than they can produce salmon. Therefore, Brazil has a comparative advantage in producing coffee.

Question 17

Use the following to answer questions : 
-(Table: Coffee and Salmon Production Possibilities II) Look at the table Coffee and Salmon Production Possibilities II. This table shows the maximum amounts of coffee and salmon, both measured in pounds, that Brazil and Alaska can produce if they just produce one good. Brazil has an absolute advantage in producing:

Accepted Answer

Brazil has an absolute advantage in producing coffee only as it can produce more coffee than Alaska (300 pounds compared to 200 pounds) while producing the same amount of salmon (100 pounds).

Question 18

If the opportunity cost of manufacturing machinery is lower in the United States than in Britain and the opportunity cost of manufacturing sweaters is higher in the United States than in Britain, then the United States will:

Accepted Answer

Since the opportunity cost of manufacturing machinery is lower in the United States than in Britain, it would be beneficial for the US to export machinery to Britain. On the other hand, since the opportunity cost of manufacturing sweaters is higher in the United States, it would be more cost-effective for the US to import sweaters from Britain. Hence, the best choice would be for the US to import sweaters from Britain and export machinery to Britain. Therefore, option D is the correct answer.

Question 19

Use the following to answer questions : 
-(Table: Comparative Advantage I) Look at the table Comparative Advantage I. The opportunity cost of producing 1 box of herring for Finland is _____ box(es) of cell phones.

Accepted Answer

The opportunity cost of producing 1 box of herring for Finland is 0.2 box(es) of cell phones. This is because Finland can produce 5 boxes of cell phones for every 1 box of herring that it produces.

Question 20

If countries engage in international trade:

Accepted Answer

When countries engage in international trade, they can consume outside their production possibility frontiers by trading with other countries who specialize in producing goods that they are less efficient at producing themselves. This allows for higher levels of consumption and a more efficient allocation of resources.

Quiz 2: Economic Models

Use the following to answer questions : -(Table: Comparative Advantage I) Look at the table Comparative Advantage I. The opportunity cost of producing 1 box of cell phones for Sweden is _____ box(es) of herring.

Trade can be beneficial to an economy because:

An economy that has the lowest opportunity cost of producing a particular good is said to have:

Use the following to answer questions : -(Table: Comparative Advantage I) Look at the table Comparative Advantage I. The opportunity cost of producing 1 box of herring for Sweden is _____ box(es) of cell phones.

If the opportunity cost of manufacturing machinery is higher in the United States than in Britain and the opportunity cost of manufacturing sweaters is lower in the United States than in Britain, then the United States will:

The concept of comparative advantage is based upon:

Use the following to answer questions : -(Table: Comparative Advantage I) Look at the table Comparative Advantage I. Finland has an absolute advantage in producing:

Use the following to answer questions : -(Table: Comparative Advantage I) Look at the table Comparative Advantage I. Sweden has a comparative advantage in producing:

Use the following to answer questions : -(Table: Comparative Advantage I) Look at the table Comparative Advantage I. The opportunity cost of producing 1 box of cell phones for Finland is _____ box(es) of herring.

Use the following to answer questions : -(Table: Comparative Advantage I) Look at the table Comparative Advantage I. Finland has a comparative advantage in producing:

An economy is said to have a comparative advantage in the production of one good if it:

Use the following to answer questions : -(Table: Comparative Advantage I) Look at the table Comparative Advantage I. Sweden has an absolute advantage in producing:

If Brazil gives up three automobiles for each ton of coffee it produces, while Peru gives up seven automobiles for each ton of coffee it produces, then Brazil has a comparative advantage in _ production and should specialize in _.

An economy is said to have a comparative advantage in the production of a good if it can produce that good:

If the opportunity cost of manufacturing machinery is lower in the United States than in Britain and the opportunity cost of manufacturing sweaters is higher in the United States than in Britain, then the United States will:

Use the following to answer questions : -(Table: Comparative Advantage I) Look at the table Comparative Advantage I. The opportunity cost of producing 1 box of herring for Finland is _____ box(es) of cell phones.

If countries engage in international trade: