McConnell_Brue_Chapter02

Imagine how much orange production would be lost if

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Unformatted text preview: uch orange production would be lost if we used a majority of the acreage in south Florida to produce wheat. • We allow Nebraska (a state in which oranges cannot grow) to produce wheat and trade wheat with Florida for oranges so the people of both regions are better off (and more productive). Chapter 2 14 Learning Objective 2-2 Slide 15 Use of Money Market systems rely heavily on the use of money due to the functions money performs in an economy. Medium of exchange is one of the most basic functions of money in that it makes trade easier to accomplish, prevents the need for barter, and prevents people from having to be in the same place with what one another needs at a specific time (coincidence of wants). Chapter 2 Learning Objective 2-2 Geographical location is important when it comes to specialization, too. Consider the example of the locations available for the production of wheat, potatoes, and oranges from your text. • Nebraska has land and climate making it much better suited for producing wheat, whereas Idaho has land and climate better suited to producing potatoes, and Florida has land and climate better suited to producing oranges. Although each st...
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