ECON%20Lesson%202[1]

ECON%20Lesson%202[1] - up changing 0.17 light bulbs to fix...

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Ashlie Michelle Ferguson Enrollment # 642885 ECON 2010 Lesson 2 1. a. Apple Feta Toby 5 gall 2.5 oz Kyle 3 gall 1.5 oz Absolute 12 min 24 min 20 min 40 min Comparative 0.5 Feta 2 Apple 0.5 Feta 2 Apple True—Their opportunity costs are the same for both the apple cider and feta cheese b. False—Her opportunity cost for vacuuming her office may be higher than the commercial cleaner’s opportunity cost. c. False—The slope of the production possibilities curve becomes steeper (or increases) as more of one good (on the horizontal axis) is produced. 2. a. False—Stella has comparative advantage at fixing fuses, because she only gives
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Unformatted text preview: up changing 0.17 light bulbs to fix 1 fuse, while Bob gives up changing 0.2 light bulbs to fix 1 fuse. Stella’s opportunity cost is lower. b. False—Stella has an absolute advantage over both because she can do them faster. c. True d. False—Stella has comparative advantage at fixing fuses, while Bob has a comparative advantage at changing light bulbs. Bob gives up fixing 5 fuses to change 1 light bulb, while Stella gives up fixing 6 fuses. e. False—see (d) 3. C 4. A 5. C 6. D 7. C 8. B 9. B 10. A 11. D 12. C 13. D 14. E 15. B 16. D 17. B...
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This note was uploaded on 05/11/2010 for the course ECON 2010 taught by Professor Roussel during the Spring '08 term at LSU.

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