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Exam 2: Comparative Advantage

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Question 41

Multiple Choice

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The accompanying figure shows Avery's weekly production possibilities curve for scarves.   For Avery, the opportunity cost of making a red scarf is:

A) decreasing.
B) increasing.
C) 1 blue scarf.
D) zero.

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Question 42

Multiple Choice

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Refer to the accompanying table. Corey's opportunity cost of making of a pizza is delivering: $\begin{array}{|l|r|r|}\hline & \text { Pizzas Made Per Hour } & \text { Pizzas Delivered Per Hour } \\\hline \text { Corey } & 12 & 6 \\\hline \text { Pat } & 10 & 15 \\\hline\end{array}$  

A) 2 pizzas.
B) 3/2 of a pizza.
C) 2/3 of a pizza.
D) 1/2 of a pizza.

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Question 43

Multiple Choice

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Refer to the accompanying table. ________ has the comparative advantage in making pies and ________ the comparative advantage in making cakes. $\begin{array} { | l | c | c | } \hline & \text { Time ta Make a Pie } & \text { Tirne to Muke a Cake } \\\hline \text { Martha } & 60 \text { minutes} & 80 \text { minutes } \\\hline \text { Julia } & 50 \text {minutes } & 60 \text { minutes } \\\hline\end{array}$  

Suppose Cathy and Lewis work in a bakery making pies and cakes. Suppose it takes Cathy 1.5 hours to make a pie and 1 hour to make a cake, and suppose it takes Lewis 2 hours to make a pie and 1.5 hours to make a cake. Which of the following statements is correct?

The fundamental reason firms outsource is that:

The United States generally has a comparative advantage in the development of technology because it has:

Moe divides his time between studying Physics and studying Economics. His production possibilities curve for his final grade in each class is shown in the accompanying figure. The Principle of Increasing Opportunity Cost is reflected in the fact that the opportunity cost going from 70 to 80 in economics is:

Refer to the accompanying figure. The opportunity cost of making an additional salad:

Refer to the accompanying table. ________ has the comparative advantage in making pizza, and ________ has the comparative advantage in delivering pizza. $\begin{array}{|l|r|r|}\hline & \text { Pizzas Made Per Hour } & \text { Pizzas Delivered Per Hour } \\\hline \text { Corey } & 12 & 6 \\\hline \text { Pat } & 10 & 15 \\\hline\end{array}$  

If Ana devotes all her time to making fudge, she can make 3 pounds of fudge an hour, and if she devotes all her time to making toffee, she can make 2 pounds of toffee an hour. If Leo devotes all his time to making fudge, he can make 4 pounds of fudge an hour, and if he devotes all his time to making toffee, he can make 5 pounds of toffee an hour. According to The Principle of Comparative Advantage, Ana and Leo will be able to produce more overall if:

Lou and Alex live together and share household chores. They like to cook some meals ahead of time and eat leftovers. The accompanying table shows the number of rooms they can each clean and the number of meals they can each cook in an hour. $\begin{array} { | l | c | c | } \hline & \text { Ronrs Cleaned Per Haur } & \text { Meals Caked Per Haur } \\\hline \text { Lou } & 5 & 4 \\\hline \text { Alex } & 3 & 3 \\\hline\end{array}$   If Alex and Lou work out an efficient arrangement for these two chores, then under that arrangement:

On a graph of a production possibilities curve, if a point is attainable, then it:

An individual has an absolute advantage in producing pizzas if that individual:

Refer to the accompanying figure. For Pat, the opportunity cost of removing one bag of trash is planting:     

Refer to the accompanying figure. If this restaurant makes 75 salads in one hour, then what's the maximum number of pizzas it can make in that same hour?

Moe divides his time between studying Physics and studying Economics. His production possibilities curve for his final grade in each class is shown in the accompanying figure. Both of Moe's professors require at least a 65 to pass and a 90 to earn an A. Which of the following is true?

If Les can produce two pairs of pants per hour while Eva can produce one pair per hour, then it must be true that:

If Al has an absolute advantage over Beth in preparing meals, then:

Lou and Alex live together and share household chores. They like to cook some meals ahead of time and eat leftovers. The accompanying table shows the number of rooms they can each clean and the number of meals they can each cook in an hour. $\begin{array} { | l | c | c | } \hline & \text { Ronrs Cleaned Per Haur } & \text { Meals Caked Per Haur } \\\hline \text { Lou } & 5 & 4 \\\hline \text { Alex } & 3 & 3 \\\hline\end{array}$   For Alex, the opportunity cost of cleaning one room is making ________ meal(s) ; for Lou the opportunity cost of cleaning one room is making ________ meal(s) .

Moe divides his time between studying Physics and studying Economics. His production possibilities curve for his final grade in each class is shown in the accompanying figure. If Moe moves from Point A to point C, his grade in Physics will go down by ________ his grade in economics.