Question 1

Tova and Ron are the only two people on the planet Melmac. It takes Tova 1 hour to produce a widget and 2 hours to produce a woggle.
It takes Ron 3 hours to produce a widget and 3 hours to produce a woggle.
Based on the information above, Tova and Ron

Accepted Answer

Tova has an absolute advantage in producing both goods but has a comparative advantage in producing widgets because she gives up fewer woggles per widget than Ron does. Ron has a comparative advantage in producing woggles because he gives up fewer widgets per woggle than Tova does. Therefore, both can gain from trade if Tova specializes in widgets and Ron specializes in woggles.

Question 2

It takes Mom 30 minutes to cook dinner. In the same time, she can iron 6 shirts. Dad takes an hour to cook dinner and 30 minutes to iron a single shirt.

Accepted Answer

Mom's opportunity cost of cooking dinner is 6 shirts, while Dad's opportunity cost is only 0.5 shirts. This means that Mom's comparative advantage is in ironing shirts, while Dad's is in cooking dinner. Therefore, it would be best for Dad to cook dinner and for Mom to iron shirts, as they can both produce more than if they each tried to do both tasks themselves.

Question 3

In two hours of work, Clinton can catch 4 fish or he can pick 5 pints of berries. In two hours, Dong can catch 6 fish or she can pick 9 pints of berries. Which statement is true?

Accepted Answer

The answer of In two hours of work, Clinton can...

Question 4

When you have no alternatives, the opportunity cost is zero.

Accepted Answer

Opportunity cost is the cost of the next best alternative forgone when making a decision. If there are no alternatives, there is no opportunity cost. Therefore, the opportunity cost is zero.

Question 5

The opportunity cost of going to college or university is the same for men and women.

Accepted Answer

The opportunity cost of going to college or university may differ between men and women due to various factors such as career opportunities, societal expectations, and family responsibilities. Women may have to sacrifice more in terms of their career and family life than men, making their opportunity cost higher.

Question 6

In one hour, Chloe can bake 24 cookies or 12 blueberry muffins; Zabeen can bake 6 cookies or 2 blueberry muffins. For mutually beneficial trade, Chloe should

Accepted Answer

The answer of In one hour, Chloe can bake 24...

Question 7

Women who do not go to college or university give up a bigger income gain than men who do not go.

Accepted Answer

Studies have shown that women who do not pursue higher education (college or university) typically give up a bigger income gain than men who do not pursue higher education. This is often referred to as the "gender pay gap" and highlights the disparities in earnings between men and women. However, it's important to note that this gap can be further compounded by factors like race, ethnicity, and other societal biases.

Question 8

Canada has an absolute advantage in situations where

Accepted Answer

Canada has an absolute advantage in situations where it can produce at a lower cost than producers in other countries. This means that Canada can produce more efficiently and with lower costs, giving it an advantage in international trade.

Question 9

Mutually beneficial trade is also called

Accepted Answer

Mutually beneficial trade refers to an agreement in which both parties agree to an exchange that benefits each other. Voluntary trade refers to a transaction in which both parties participate willingly and without coercion, making it the best choice for describing mutually beneficial trade. A is incorrect because a zero-sum game implies that there must be a winner and loser, and mutually beneficial trade aims for both parties to "win." B is incorrect because self-sufficiency would not involve any trading. C is incorrect because international subsidization refers to a government providing financial aid to a foreign country, not trade between private entities. E is incorrect because involuntary trade would involve one party being coerced or forced into the transaction, which goes against the definition of mutually beneficial trade.

Question 10

It takes Mom 30 minutes to cook dinner. In the same time, she can iron 6 shirts. Dad takes an hour to cook dinner and 30 minutes to iron a single shirt.

Accepted Answer

The answer of It takes Mom 30 minutes to cook...

Question 11

In a zero-sum game

Accepted Answer

In a zero-sum game, the gains of one player come at the expense of the other player's losses. Therefore, one player gains only when another player loses.

Question 12

To encourage a child to do his chores, you should either increase the reward for doing, or increase the penalty for not doing the chores.

Accepted Answer

By increasing the reward or incentive for doing chores, the child is more likely to be motivated to complete them. Alternatively, increasing the penalty or consequences for not doing chores may also encourage the child to complete them. Reward and punishment are two basic principles of behavior modification that help to shape and reinforce desired behaviors.

Question 13

In two hours of work, Clinton can catch 4 fish or he can pick 5 pints of berries. In two hours, Dong can catch 6 fish or she can pick 9 pints of berries. Which statement is true?

Accepted Answer

In two hours, Clinton can catch 4 fish or pick 5 pints of berries which means he can catch 2 fish per hour or pick 2.5 pints of berries per hour. 
In two hours, Dong can catch 6 fish or pick 9 pints of berries which means she can catch 3 fish per hour or pick 4.5 pints of berries per hour.

If Clinton catches fish for two hours, he would catch 4 fish. However, if he picks berries instead, he would get 5 pints. Therefore, his opportunity cost of catching fish is equal to 5 pints of berries. 
For Dong, her opportunity cost of catching fish is equal to picking 3 pints of berries.

Since Dong can pick berries faster than Clinton, it would be beneficial for both of them to trade. Clinton can catch fish and trade with Dong for some of her berries. In doing so, Clinton will have a higher value of berries than he would have had if he decided to pick berries himself. Dong, on the other hand, will have a higher value of fish by trading with Clinton. Therefore, both parties will benefit from the trade.

Question 14

Mutual gains from voluntary trade require differences in

Accepted Answer

Mutual gains from voluntary trade are possible because of comparative advantage, which means that each party specializes in producing the goods or services they are relatively better at producing, and then trades with each other. This leads to an overall increase in output and efficiency, benefiting all parties involved.

Question 15

It takes Mom 30 minutes to cook dinner. In the same time, she can iron 6 shirts. Dad takes an hour to cook dinner and 30 minutes to iron a single shirt.

Accepted Answer

Dad has an absolute advantage in cooking because he can cook dinner in half the time it takes Mom. However, Mom can iron 6 shirts in the same amount of time it takes Dad to iron only one shirt. Therefore, it is more efficient for Mom to iron shirts while Dad cooks dinner. The opportunity cost for Dad to cook dinner is only 2 shirts because he can use the same amount of time it takes Mom to iron 6 shirts to cook dinner and iron 2 shirts himself. Therefore, D is the best choice.

Question 16

Mutual gains from voluntary trade require differences in

Accepted Answer

Mutual gains from voluntary trade require differences in opportunity costs. Opportunity cost is the value of the next best alternative forgone when making a choice. When two parties trade voluntarily, it is because they have different opportunity costs for producing a certain good or service, and by trading, they can benefit from each other's lower opportunity cost.

Question 17

In one hour, Chloe can bake 24 cookies or 12 blueberry muffins; Zabeen can bake 6 cookies or 2 blueberry muffins. Which statement is true?

Accepted Answer

Chloe's opportunity cost of baking one muffin is the number of cookies she could have baked instead, which is 24 cookies for 12 muffins, or 2 cookies per muffin.

Question 18

Specialization eliminates

Accepted Answer

Specialization involves individuals or countries focusing on producing a limited range of goods or services in which they have particular expertise or resources. This often means giving up some level of self-sufficiency in other areas. Therefore, option C - self-sufficiency - is eliminated by specialization. Option A (scarcity), B (dependency), D (mutual benefits), and E (opportunity cost) are not eliminated by specialization, but may be affected by it.

Question 19

If Canada specializes in the production of wine we can produce 10,000 bottles per month. If Canada specializes in the production of wheat we can produce 200,000 bushels per month. The opportunity cost of a bottle of wine in Canada is

Accepted Answer

The opportunity cost of a bottle of wine is the amount of wheat that could have been produced with the resources used to produce one bottle of wine.

We can calculate this by finding the ratio of the amount of wheat produced per month to the amount of wine produced per month:

200,000 bushels / 10,000 bottles = 20 bushels per bottle

Therefore, the opportunity cost of a bottle of wine in Canada is 20 bushels of wheat.

Question 20

Mutually beneficial trade occurs if both persons

Accepted Answer

Mutually beneficial trade occurs when both parties produce the product for which they have a comparative advantage. This means that they focus on producing the good or service they are relatively better at producing and exchanging it for the good or service they are less efficient at producing. By specializing in this way, both parties can produce more and benefit from the increased quantity of goods and services available to them through trade.

Quiz 1: Whats in Economics for You Scarcity, Opportunity Cost, Trade, and Models

Tova and Ron are the only two people on the planet Melmac. It takes Tova 1 hour to produce a widget and 2 hours to produce a woggle. It takes Ron 3 hours to produce a widget and 3 hours to produce a woggle. Based on the information above, Tova and Ron

It takes Mom 30 minutes to cook dinner. In the same time, she can iron 6 shirts. Dad takes an hour to cook dinner and 30 minutes to iron a single shirt.

In two hours of work, Clinton can catch 4 fish or he can pick 5 pints of berries. In two hours, Dong can catch 6 fish or she can pick 9 pints of berries. Which statement is true?

When you have no alternatives, the opportunity cost is zero.

The opportunity cost of going to college or university is the same for men and women.

In one hour, Chloe can bake 24 cookies or 12 blueberry muffins; Zabeen can bake 6 cookies or 2 blueberry muffins. For mutually beneficial trade, Chloe should

Women who do not go to college or university give up a bigger income gain than men who do not go.

Canada has an absolute advantage in situations where

Mutually beneficial trade is also called

It takes Mom 30 minutes to cook dinner. In the same time, she can iron 6 shirts. Dad takes an hour to cook dinner and 30 minutes to iron a single shirt.

In a zero-sum game

To encourage a child to do his chores, you should either increase the reward for doing, or increase the penalty for not doing the chores.

In two hours of work, Clinton can catch 4 fish or he can pick 5 pints of berries. In two hours, Dong can catch 6 fish or she can pick 9 pints of berries. Which statement is true?

Mutual gains from voluntary trade require differences in

It takes Mom 30 minutes to cook dinner. In the same time, she can iron 6 shirts. Dad takes an hour to cook dinner and 30 minutes to iron a single shirt.

Mutual gains from voluntary trade require differences in

In one hour, Chloe can bake 24 cookies or 12 blueberry muffins; Zabeen can bake 6 cookies or 2 blueberry muffins. Which statement is true?

Specialization eliminates

If Canada specializes in the production of wine we can produce 10,000 bottles per month. If Canada specializes in the production of wheat we can produce 200,000 bushels per month. The opportunity cost of a bottle of wine in Canada is

Mutually beneficial trade occurs if both persons