1. Lamya has a comparative advantage in writing a term paper if she A. can write a paper faster than the other students in class. B. has an absolute advantage in writing a term paper. C. always earns an A on her papers. D. has a low opportunity cost for writing a term paper. 2. Ghadah and Maryam are lost in the jungle, where the only things to eat are mangoes and fish. Ghadah can gather mangoes faster than Maryam and can also catch more fish per hour than can Maryam. Therefore, A. Ghadah should specialize in fishing because it is harder than gathering mangoes, and Maryam should specialize in gathering mangoes. B. Ghadah should strike out on her own, because Maryam reduces their combined productivity. C. Maryam should specialize in the activity for which she has a comparative advantage. D. Ghadah should specialize in the activity for which she has an absolute advantage. 3. Point A on a linear production possibilities curve represents a combination of 12 coffees and 3 cappuccinos, and point B represents 3 coffees and 6 cappuccinos. Suppose coffees are on the vertical axis and cappuccinos are on the horizontal axis. The opportunity cost of a cup of cappuccino is A. 3 coffees B. 9 coffees C. 1/3 of a coffee D. 6 coffees

1. Lamya has a comparative advantage in writing a term paper if she A. can write a paper faster than the other students in class. B. has an absolute advantage in writing a term paper. C. always earns an A on her papers. D. has a low opportunity cost for writing a term paper. 2. Ghadah and Maryam are lost in the jungle, where the only things to eat are mangoes and fish. Ghadah can gather mangoes faster than Maryam and can also catch more fish per hour than can Maryam. Therefore, A. Ghadah should specialize in fishing because it is harder than gathering mangoes, and Maryam should specialize in gathering mangoes. B. Ghadah should strike out on her own, because Maryam reduces their combined productivity. C. Maryam should specialize in the activity for which she has a comparative advantage. D. Ghadah should specialize in the activity for which she has an absolute advantage. 3. Point A on a linear production possibilities curve represents a combination of 12 coffees and 3 cappuccinos, and point B represents 3 coffees and 6 cappuccinos. Suppose coffees are on the vertical axis and cappuccinos are on the horizontal axis. The opportunity cost of a cup of cappuccino is A. 3 coffees B. 9 coffees C. 1/3 of a coffee D. 6 coffees

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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