Refer to Figure 1. If Daisy must work 2.5 hours to make each pie, then her production possibilities frontier is based on how many hours of work?
a. 6 hours
b. 7.5 hours
c. 37.5 hours
d. 50 hours
Refer to Figure 1. If Maxine and Daisy each divides her time equally between making pies and making tarts, then total production is
a. 6 pies and 10 tarts.
b. 7.5 pies and 3 tarts.
c. 7.5 pies and 10 tarts.
d. 13.5 pies and 13 tarts.
Refer to Table 1. Assume that the farmer and the rancher each has 40 labor hours available. If each person divides his time equally between the production of meat and potatoes, then total production is
a. 5 pounds of meat and 4 pounds of potatoes.
b. 6 pounds of meat and 7.5 pounds of potatoes.
c. 7.5 pounds of meat and 6 pounds of potatoes.
d. 10 pounds of meat and 8 pounds of potatoes.
18. Refer to Table 1. Which of the following combinations of meat and potatoes could the farmer produce in 40 hours?
a. 1 pound of meat and 7 pounds of potatoes.
b. 2 pounds of meat and 5 pounds of potatoes.
c. 3 pounds of meat and 3 pounds of potatoes.
d. 4 pounds of meat and 2 pounds of potatoes.
19. Refer to Table 2. Assume that John and Jane each work 24 hours. What happens to total production if instead of each person spending 12 hours producing each good, Jane spends 21 hours producing wine and 3 hours producing bread and John spends 3 hours producing wine and 21 hours producing bread?
a. The total production of bread and wine each rise.
b. The total production of bread rises and the total production of wine falls.
c. The total production of bread falls and the total production of wine rises.
d. The total production of bread and wine each fall.
Refer to Figure 2. Suppose Maxine decides to increase her production of tarts by 5. What is the opportunity cost of this decision?
a. 2/5 pie
b. 2 pies
c. 5/2 pies
d. 10 pies
Refer to Figure 2. Maxine has an absolute advantage in the production of
a. both goods and a comparative advantage in the production of pies.
b. both goods and a comparative advantage in the production of tarts.
c. neither good and a comparative advantage in the production of pies.
d. neither good and a comparative advantage in the production of tarts.
Refer to Figure 2. Daisy has an absolute advantage in the production of
a. both goods and a comparative advantage in the production of pies.
b. both goods and a comparative advantage in the production of tarts.
c. neither good and a comparative advantage in the production of pies.
d. neither good and a comparative advantage in the production of tarts.
Refer to Figure 2. If Maxine and Daisy switch from each person dividing her time equally between the production of pies and tarts to each person spending all of her time producing the good in which she has a comparative advantage, then total production of tarts will increase by
a. 7.
b. 10.
c. 17.
d. 20.
Refer to Figure 2. At which of the following prices would both Maxine and Daisy gain from trade with each other?
a. 4 tarts for 2 pies
b. 8 tarts for 12 pies
c. 12 tarts for 28 pies
d. Maxine and Daisy could not both gain from trade with each other at any price.
Refer to Table 3. What is Brad’s opportunity cost of producing one pound of beef?
a. 5/6 bushel of wheat
b. 6/5 bushels of wheat
c. 3/5 bushels of wheat
d. 5/3 bushels of wheat
Refer to Table 3. What is Brad’s opportunity cost of producing one bushel of wheat?
a. 5/6 pound of beef
b. 6/5 pounds of beef
c. 3/5 pounds of beef
d. 5/3 pounds of beef
Refer to Table 3. What is Theresa’s opportunity cost of producing one bushel of wheat?
a. 5/6 pound of beef
b. 6/5 pound of beef
c. 3/5 pound of beef
d. 5/3 pounds of beef
Refer to Table 3. Brad has an absolute advantage in the production of
a. wheat and Theresa has an absolute advantage in the production of beef.
b. beef and Theresa has an absolute advantage in the production of wheat.
c. both goods and Theresa has an absolute advantage in the production of neither good.
d. neither good and Theresa has an absolute advantage in the production of both goods.
Refer to Table 3. Brad has a comparative advantage in the production of
a. wheat and Theresa has a comparative advantage in the production of beef.
b. beef and Theresa has a comparative advantage in the production of wheat.
c. both goods and Theresa has a comparative advantage in the production of neither good.
d. neither good and Theresa has a comparative advantage in the production of both goods.
a. benefit both Steve and Tom.
b. benefit Steve, but not Tom.
c. benefit Tom, but not Steve.
d. benefit neither Steve nor Tom.
Refer to Figure 3. Chile should specialize in the production of
a. coffee and import soybeans.
b. soybeans and import coffee.
c. both goods and import neither good.
d. neither good and import both goods.
Refer to Figure 3. Colombia should specialize in the production of
a. coffee and import soybeans.
b. soybeans and import coffee.
c. both goods and import neither good.
d. neither good and import both goods.
opp of barrel: 6 pounds
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