Econ114 Chapter1 - Question #1 Production possibilities...

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Question #1 Production possibilities tables for two countries, North Cantina and South Cantina: North Cantina Production possibilities (alternatives) A B C D E F Capital goods 5 4 3 2 1 0 Consum er goods 0 10 18 24 28 30 South Cantina Production possibilities (alternatives) A B C D E F Capital goods 5 4 3 2 1 0 Consumer goods 0 8 15 21 25 27 Reference: Ref 1.4 Refer to the above tables. The opportunity cost of the fifth unit of capital goods:
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Choose an Answer: A. is higher in North Cantina than in South Cantina. B. is the same in North Cantina and South Cantina. C. is lower in North Cantina than in South Cantina. D. cannot be determined from the information provided. Question #2 Specialization and trade are beneficial to society because: Choose an Answer: A. the output of economic goods may be increased with no increase in resources. B. scarce resources are utilized more efficiently. C. a division of labour lowers prices for products. D. all of the above are correct. Question #3 Which of the following is not an illustration of the idea of opportunity cost? Choose an Answer: A. A growing economy can produce more consumer goods and more capital goods at the same time. B. If I buy a pizza, I will not be able to afford a movie.
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This note was uploaded on 02/02/2010 for the course ECON 114 taught by Professor Chartrand during the Winter '09 term at University of Saskatchewan- Management Area.

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Econ114 Chapter1 - Question #1 Production possibilities...

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