HW2_09sol - ECO 108: Introduction to Economics Problem Set...

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2-1 ECO 108: Introduction to Economics Problem Set 2 Chapter 2 Professor: Eva Carceles-Poveda 1. To say that an individual possesses an absolute advantage in the production of software means that individual A. has a lower opportunity cost of producing software. B. can produce more and/or higher quality software in a given amount of time. C. was the first to create the software. D. charges the lowest price for software. 2. If a nation can produce a good more quickly than any other nation, that nation has a(n) A. comparative advantage. B. absolute advantage. C. relative advantage. D. specialization advantage. 3. If a nation has the lowest opportunity cost of producing a good, that nation has a(n) A. comparative advantage. B. absolute advantage. C. comparative and absolute advantage. D. absolute advantage and possibly a comparative advantage.
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2-2 4. Refer to the figure above. According to the data, Corey has an absolute advantage in A. the production of pizza. B. neither production of pizza nor delivering pizza. C. delivering pizza. D. both production of pizza and delivering pizza. . 5. Refer to the figure above. According to the data, Pat has an absolute advantage in A. the production of pizza. B. neither production of pizza nor delivering pizza. C. delivering pizza. D. both production of pizza and delivering pizza. 6. Refer to the figure above. Corey's opportunity cost of producing an extra pizza is delivering
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This note was uploaded on 01/27/2011 for the course ECO 108 taught by Professor Wolman during the Spring '08 term at SUNY Stony Brook.

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HW2_09sol - ECO 108: Introduction to Economics Problem Set...

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