Quiz 9

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Texas A&M University, Corpus Christi *

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5315

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Economics

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Apr 24, 2024

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Uploaded by ChefMoosePerson1140

Quiz 9 : Many economists support trade agreements, maintaining that the agreements improve economic efficiency because they result in goods being produced at the lowest opportunity cost. Workers in industries protected by tariffs and quotas are likely to support these trade restrictions because they believe the restrictions will protect their jobs. Eliminating a tariff on running shoes would ________ businesses that sell running shoes and ________ consumers who purchase them. benefit; benefit ________ is the ability of an individual, a firm, or a country to produce a good or service at a lower opportunity cost than competitors. Comparative advantage Bathing Grooming Linda 60 20 Sandy 50 25 Linda and Sandy own The Preppy Puppy, a dog grooming business. The table above lists the number of dogs Linda and Sandy can each bathe and groom in one week. Select the statement that accurately interprets the data in the table. Part 2 Linda has an absolute advantage in dog bathing and Sandy has an absolute advantage in dog grooming. Bathing Grooming Linda 60 20 Sandy 50 25 Linda and Sandy own The Preppy Puppy, a dog grooming business. The table above lists the number of dogs Linda and Sandy can each bathe and groom in one week. Select the statement that accurately interprets the data in the table. Part 2 Sandy's opportunity cost for dog grooming is less than Linda's. Bathing Grooming Linda (3:1) 60 20

Sandy (2:1) 50 25 Linda and Sandy own The Preppy Puppy, a dog grooming business. The table above lists the number of dogs Linda and Sandy can each bathe and groom in one week. Select the statement that accurately interprets the data in the table. Sandy has a comparative advantage in dog grooming. Bathing Grooming Linda 60 20 Sandy 50 25 Linda and Sandy own The Preppy Puppy, a dog grooming business. The table above lists the number of dogs Linda and Sandy can each bathe and groom in one week. Select the statement that accurately interprets the data in the table. Linda has a comparative advantage in dog bathing. Assume that China has a comparative advantage in producing corn and exports corn to Japan. We can conclude that China has a lower opportunity cost of producing corn relative to Japan. If the opportunity cost of production for two goods is different between two countries , then mutually beneficial trade is possible. If Canada has a comparative advantage over Mexico in the production of timber, then the opportunity cost of production for timber is lower in Canada than in Mexico. If Canada imports fishing poles from Mexico and Mexico imports bacon from Canada, which of the following would explain this pattern of trade? The opportunity cost of producing fishing poles in Canada is higher than it is in Mexico, and the opportunity cost of producing bacon in Mexico is higher than it is in Canada. ________ is the ability to produce more of a good or service than competitors when using the same amount of resources. Absolute advantage Trade that is within a country or between countries is based on the principle of comparative advantage.

Berries Fish Rob 20 80 Bill 30 60 Rob Crusoe and Bill Friday spent their week−long vacation on a desert island where they had to find and prepare their own food. Rob and Bill spent one day each fishing and picking berries. The table lists the pounds of output Rob and Bill produced. Use the table above to select the statement that accurately interprets the data in the table. Bill has an absolute advantage in picking berries and Rob has an absolute advantage in catching fish.

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