tjp_sample_eco300

tjp_sample_eco300 - Below are some example questions from...

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Below are some example questions from previous exams. The answers are given at the end of the document. 1. The information below gives information for a Ricardian model. Unit Labor Requirement Coffee Apples Colombia 4 10 Brazil 5 12 Colombia has absolute advantage in a. Coffee b. Apples c. Both goods d. Neither good e. Not enough information is given to determine absolute advantage. 2. Use the information given in question 1. According to Adam Smith, when these two countries move from autarky to free trade a. Colombia will export Coffee and Brazil will export Apples b. Colombia will export Apples and Brazil will export Coffee c. Colombia will export both Coffee and Apples d. Brazil will export both Coffee and Apples e. there does not exist the potential for mutually beneficial trade f. Not enough information is given to determine what Smith would have predicted about trade patterns.
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3. Use the information given in question 1. In addition suppose that Colombia has 100 workers and Brazil has 60 workers. What is the quantity of Coffee produced in Colombia in autarky? a. 5 b. 10 c. 25 d. 400 e. 0 f. Not enough information is given to calculate autarky production. 4. Use the information given in question 1 and 3. In addition suppose that the countries open up to free trade. Suppose further that the free trade price ratio lies strictly between the two countries autarky price ratios. What is the quantity of Coffee produced in Brazil in free trade? a. 5 b. 10 c. 300 d. 12 e. 0 f. Not enough information is given to calculate free trade production. 5. Country A is said to be capital-abundant relative to Country B if a. Country A’s endowment of capital is greater than Country B’s endowment of capital. b. Country A’s endowment of labor is greater than Country B’s endowment of labor. c. The ratio of Country A’s capital to labor is greater than Country B’s ratio of capital to labor. d. The ratio of Country A’s capital to labor is smaller than Country B’s ratio of capital to labor. e. None of the above
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6. The information below gives information for a Ricardian model. Unit Labor Requirement Wine Beer Labor Endowment France 6 10 60 Germa ny 3 6 60 What is the opportunity cost of production of Wine (in France) a. 3/5 b. 5/3 c. 1 d. 2 e. None of the above. 7. Use the information given in question 6. Assuming Wine is plotted on the x-axis, what is the Marginal Rate of Substitution in autarky (in Germany). a. 3/5 b. 5/3 c. 1 d. 2 e. None of the above.
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8. The following table is reproduced from the textbook. Capital Endowment Labor Endowment Capital/Labor Country (Billion $) (1,000 Persons) (Billion $ per 1,000 Persons) Argentina 24,018 8,496 2.83 Austria 15,653 3,363 4.65 United States 110,717 25,396 4.36 The United States is a. capital-abundant relative to both Argentina and Austria b. capital-abundant and labor-abundant relative to both Argentina and Austria c. capital-abundant relative to Argentina and labor-abundant relative to Austria d. capital-abundant relative to Austria and labor-abundant relative to Argentina e. None of the above.
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tjp_sample_eco300 - Below are some example questions from...

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