Question :
11.Consider two individuals — Howard and Mai — each of : 1262263
11.Consider two individuals — Howard and Mai — each of whom would like to wear sweaters and eat tasty food. The gains from trade between Howard and Mai are least obvious in which of the following cases?
a.Howardisverygoodatknittingsweatersandatcookingtastyfood,butMai’sskillsinbothoftheseactivitiesareverypoor.
b.Howardisverygoodatknittingsweatersandatcookingtastyfood;Maiisverygoodatknittingsweaters,butsheknowsnothingaboutcookingtastyfood.
c.Howard’sskillsinknittingsweatersarefairlygood,buthisskillsincookingtastyfoodarefairlybad?Mai’sskillsinknittingsweatersarefairlybad,butherskillsincookingtastyfoodarefairlygood.
d.Howard’sskillsaresuchthathecanproduceonlysweaters,andMai’sskillsaresuchthatshecanproduceonlytastyfood.
12.Aprofessorspends10hoursperdaygivinglecturesandwritingpapers.Fortheprofessor,agraphthatshowshisvariouspossiblemixesofoutput(lecturesgivenperdayandpaperswrittenperday)iscalledhis
a.lineoftastes.
b.trade-offcurve.
c.productionpossibilitiesfrontier.
d.consumptionpossibilitiesfrontier.
13.Supposethereareonlytwopeopleintheworld.Eachperson’sproductionpossibilitiesfrontieralsorepresentshisorherconsumptionpossibilitieswhen
a.neitherpersonfacestrade-offs.
b.thefrontiersarestraightlines.
c.thefrontiersarebowedout.
d.theychoosenottotradewithoneanother.
14.Themostobviousbenefitofspecializationandtradeisthattheyallowusto
a.workmorehoursperweekthanweotherwisewouldbeabletowork.
b.consumemoregoodsthanweotherwisewouldbeabletoconsume.
c.spendmoremoneyongoodsthatarebeneficialtosociety,andlessmoneyongoodsthatareharmfultosociety.
d.consumemoregoodsbyforcingpeopleinothercountriestoconsumefewergoods.
15.Asastudent,Annespends40hoursperweekwritingtermpapersandcompletinghomeworkassignments.Ononeaxisofherproductionpossibilitiesfrontierismeasuredthenumberoftermpaperswrittenperweek.Ontheotheraxisismeasuredthenumberofhomeworkassignmentscompletedperweek.Anne’sproductionpossibilitiesfrontierisastraightlineif
a.shefacesnotrade-offbetweenwritingtermpapersandcompletinghomeworkassignments.
b.shecanswitchbetweenwritingtermpapersandcompletinghomeworkassignmentsataconstantrate.
c.therateatwhichshecanswitchbetweenhomeworkassignmentsandtermpapersdependsonthenumberofhomeworkassignmentssheiscompletingandonthenumberoftermpaperssheiswriting.
d.sheisrequiredbyherprofessorstospendhalfofhertimeontermpapersandtheotherhalfofhertimeonhomeworkassignments.
16.Foraself-sufficientproducer,theproductionpossibilitiesfrontier
a.isthesameastheconsumptionpossibilitiesfrontier.
b.isgreaterthantheconsumptionpossibilitiesfrontier.
c.islessthantheconsumptionpossibilitiesfrontier.
d.isalwaysastraightline.
Table3-1
AssumethatJohnandJanecanswitchbetweenproducingbreadandwineataconstantrate.
LaborHoursNeededtoMake
BottleofWine
LoafofBread
Jane
2
1.5
John
3
1
17.RefertoTable3-1.AssumethatJohnandJaneeachwork24hours.Whathappenstototalproductionifinsteadofeachpersonspending12hoursproducingeachgood,Janespends21hoursproducingwineand3hoursproducingbreadandJohnspends3hoursproducingwineand21hoursproducingbread?
a.Thetotalproductionofbreadandwineeachrise.
b.Thetotalproductionofbreadrisesandthetotalproductionofwinefalls.
c.Thetotalproductionofbreadfallsandthetotalproductionofwinerises.
d.Thetotalproductionofbreadandwineeachfall.
Table3-2
AssumethatEnglandandHollandcanswitchbetweenproducingmilkandoatsataconstantrate.
NumberofUnitsProducedinanHour
Milk
Oats
England
10
4
Holland
8
6
18.RefertoTable3-2.WecouldusetheinformationinthetabletodrawaproductionpossibilitiesfrontierforEnglandandasecondproductionpossibilitiesfrontierforHolland.Ifweweretodothis,measuringmilkalongthehorizontalaxis,then
a.theslopeofEngland’sproductionpossibilitiesfrontierwouldbe10/4andtheslopeofHolland’sproductionpossibilitiesfrontierwouldbe-4/3.
b.theslopeofEngland’sproductionpossibilitiesfrontierwouldbe4/10andtheslopeofHolland’sproductionpossibilitiesfrontierwouldbe-3/4.
c.theslopeofEngland’sproductionpossibilitiesfrontierwouldbe10/4andtheslopeofHolland’sproductionpossibilitiesfrontierwouldbe4/3.
d.theslopeofEngland’sproductionpossibilitiesfrontierwouldbe4/10andtheslopeofHolland’sproductionpossibilitiesfrontierwouldbe3/4.
Table3-3
ProductionOpportunities
HoursNeededtoMake1Unitof
NumberofUnitsProducedin40Hours
Cheese
Wine
Cheese
Wine
England
1
4
40
10
France
5
2
8
20
19.RefertoTable3-3.AssumethatEnglandandFranceeachhas40laborhoursavailable.Ifeachcountrydividesitstimeequallybetweentheproductionofcheeseandwine,thentotalproductionis
a.8unitsofcheeseand10unitsofwine
b.24unitsofcheeseand15unitsofwine
c.40unitsofcheeseand20unitsofwine
d.48unitsofcheeseand30unitsofwine
20.RefertoTable3-3.WhichofthefollowingcombinationsofcheeseandwinecouldFranceproducein40hours?
a.2unitsofcheeseand20unitsofwine
b.4unitsofcheeseand15unitsofwine
c.6unitsofcheeseand5unitsofwine
d.8unitsofcheeseand20unitsofwine