Refer to Table 5.2. This table shows the number of labor hours required to produce a bicycle and a harmonica in Germany and Sweden
a. Which country has an absolute advantage in the production of bicycles?
b. Which country has an absolute advantage in the production of harmonicas?
c. What is Germany's opportunity cost of producing one bicycle?
d. What is Sweden's opportunity cost of producing one bicycle?
e. What is Germany's opportunity cost of producing one harmonica?
f. What is Sweden's opportunity cost of producing one harmonica?
g. If each country specializes in the production of the product in which it has a comparative advantage, who should produce bicycles?
h. If each country specializes in the production of the product in which it has a comparative advantage, who should produce harmonicas?
a. Sweden has an absolute advantage in the production of bicycles.
b. Sweden has an absolute advantage in the production of harmonicas.
c. Germany's opportunity cost of producing one bicycle is 4 harmonicas.
d. Sweden's opportunity cost of producing one bicycle is 4.5 harmonicas
e. Germany's opportunity cost of one harmonica is 0.25 bicycle.
f. Sweden's opportunity cost of one harmonica is 0.22 bicycle.
g. Germany should specialize in producing bicycles.
h. Sweden should specialize in producing harmonicas.
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Pete the Pizza Man produced $87,000 worth of pizzas in the past year. He paid $39,000 to employees, paid $11,000 for vegetables and other ingredients, and paid $5000 in taxes
He began the year with ingredient inventories valued at $1000, and ended the year with inventories valued at $2000. What was Pete's (and his employees') total contribution to GDP this year?
The price of good B has a pattern such that P = $20 on Monday through Thursday of every week, and P = $25 on Fridays. If speculators begin participating in the market for good B, their actions will likely lead to a(n) ______________ in the price of good B on Monday through Thursday and a(n) _______________ in the price of good B on Friday
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease
Positive economics encourages value judgments.
a. true b. false
Refer to the information provided in Figure 5.3 below to answer the question(s) that follow.
Figure 5.3Refer to Figure 5.3. Using the midpoint formula, if the price of a gardenburger increases from $7 to $9, the price elasticity of demand equals ________ and the increase results in a(n) ________ in total revenue.
A. -0.5; decrease B. -8; decrease C. -0.375; increase D. -2.67; decrease