13. Draw 3 PPF’s, one with Linear Opportunity Give the following information Cost, one with Increasing Opportunity Cost, and answer questions below (a-f): one with Decreasing Opportunity Cost. Production (in thousands) per month Coconuts Fish Country T 30 40 Country H 20 10 What is the opportunity cost of 14. Draw a on one of the PPF’s above that one fish in Country T? would indicate an inefficient point. Then define ¾ coconut an inefficient point below: 4 coconuts 4/3 coconuts 15. Draw 2 PPF’s, one that indicates there has What is the opportunity cost of been an positive change in technology for one one fish in Country H? good, and another that indicate there has been a ½ coconut positive change in technology for both goods: 2 coconuts 1 coconut Which country has the comparative advantage in fish? Country T Country H Neither country 16. List at least 2 variables that are held constant What is the opportunity cost of in any given PPF: one coconut in Country T? ¾ fish Use the table to answer 17-19 4 fish In one hour SpongeBob Patrick Sandy 4/3 fish # of Jelly Fish 5 3 10 What is the opportunity cost # of Krabby Patties 60 30 40 of one coconut in Country H? # of Kelp Shakes 20 40 40 ½ coconut 2 coconuts 17. Who has absolute advantage in each of the 1 coconut three commodities? Which country has the comparative advantage in 18. Who has the comparative advantage in coconuts? Krabby Patties when. . . Country T a) comparing to Jelly Fish? Country H b) comparing to Kelp Shakes? Neither country 19. Who has comparative advantage in Kelp shakes compared to Graph the combined PPF of these two a) Jelly Fish products for 12 hours b) Krabby Patties (for 1 Bushel) Apples Oranges Bill 2 hr 6 hr 20. Explain the impact of specialization and Bob 1 hr 4 hr on a PPF How many of each product should they produce?
13. Draw 3 PPF’s, one with Linear Opportunity Cost, one with Increasing Opportunity Cost, and one with Decreasing Opportunity Cost. 14. Draw a on one of the PPF’s above that would indicate an inefficient point. Then define an inefficient point below: 15. Draw 2 PPF’s, one that indicates there has been an positive change in technology for one good, and another that indicate there has been a positive change in technology for both goods: 16. List at least 2 variables that are held constant in any given PPF: Use the table to answer 17-19 In one hour SpongeBob Patrick Sandy # of Jelly Fish 5 3 10 # of Krabby Patties 60 30 40 # of Kelp Shakes 20 40 40 17. Who has absolute advantage in each of the three commodities? 18. Who has the comparative advantage in Krabby Patties when. . . a) comparing to Jelly Fish? b) comparing to Kelp Shakes? 19. Who has comparative advantage in Kelp shakes compared to a) Jelly Fish b) Krabby Patties 20. Explain the impact of specialization and on a PPF Give the following information answer questions below (a-f): Production (in thousands) per month Coconuts Fish Country T 30 40 Country H 20 10 What is the opportunity cost of one fish in Country T? ¾ coconut 4 coconuts 4/3 coconuts What is the opportunity cost of one fish in Country H? ½ coconut 2 coconuts 1 coconut Which country has the comparative advantage in fish? Country T Country H Neither country What is the opportunity cost of one coconut in Country T? ¾ fish 4 fish 4/3 fish What is the opportunity cost of one coconut in Country H? ½ coconut 2 coconuts 1 coconut Which country has the comparative advantage in coconuts? Country T Country H Neither country Graph the combined PPF of these two products for 12 hours (for 1 Bushel) Apples Oranges Bill 2 hr 6 hr Bob 1 hr 4 hr How many of each product should they produce?
ECON_101_Kreider_ckennedy_ECON_101_Exam_1Review.docx