Question

37) Refer to Table 7-4. Which country has an A) Estonia B) Morocco C) both countries D) neither country advantage in producing 38) Refer to Table 7-6. What is the opportunity cost to produce 1 be in Eston A) 1/3 of a sword B) 3/5 of a sword C) 1.67 swords D) 5 swords 39) Refer to Table 7-6. What is the opportunity cost to produce 1 betin Morocco A) 1/2 of a sword B) 1 sword C) 1.5 swords D) 2 swords 40) Refer to Table 7-6. With trade, what is the total gain in bet production! A) 20 B) 40 C) 60 D) 120 Bonus Questions 41) Assume that the price for lawn care has fallen and sales of lawn care services have also fallen. One can conclude that A) the law of supply has been violated. B) the number of lawn care service companies has increased. C) the demand for lawn care service has decreased. D) lawn care services are deliberately charging low prices because they want to discourage people from maintaining their own lawns. 42) In recent years the cost of producing wines in the U.S. has increased largely due to rising rents for vineyards. At the same time, more and more Americans prefer wine over beer. Which of the following best explains the effect of these events in the wine market? A) The supply curve has shifted to the left and the demand curve has shifted to the right. As a result there has been an increase in the equilibrium quantity and an uncertain effect on the equilibrium price, B) Both the supply and demand curves have shifted to the right. As a result, there has been an increase in the equilibrium price and an uncertain effect on the equilibrium quantity. C) Both the supply and demand curves have shifted to the right. As a result, there has been an increase in both the equilibrium price and the equilibrium quantity. D) The supply curve has shifted to the left and the demand curve has shifted to the right. As a result, there has been an increase in the equilibrium price and an uncertain effect on the equilibrium quantity 43) If Norwegian workers are more productive than Albanian workers, then trade between Norway and Albania A) cannot take place because Norwegian goods and services will be less expensive than Albanian goods and services B) will take place so long as each country has a comparative advantage in a good or service that buyers in the other country want. C) cannot take place until Albanian workers become more productive. D) can take place only if Albania has an absolute advantage in producing a good or service Norwegian buyers want.

Answer 1

Table .6 answered. cum s Quanti by t is missing so, questions 37-40 could not be Next answers are as follows: A-41 Option c. do this case, me can assume that demand has fallen because it leads to fall in price which results in fall in equilibrin bud of duantity sold A-42 optiain D. Increase in cost of production shifts the supply curne leftwards to s 's'. - Increase bus Price & in preference over mine will shift demand curie right wards to old . This leads to now o equi librium at Ę where equilibrium pre has increased and impact on Quantity is uncertain .. A-43) Option B. Trade between two countries take place as long as each country has a comparative advantage in a good or ternice that buyers in another country wants. nonti