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Name: ________________________ Class: ___________________ Date: __________ ID: A 1 Exam 1 Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. The pictures below depict the production possibilities frontier for Bulgaria and Macedonia. Use these to answer the questions that follow Bulgaria Macedonia Tobacco Tobacco Wheat Wheat 9 6 4 3 ____ 1. What is the opportunity cost of tobacco in Bulgaria? a. 2/3 c. 3/2 b. 3/4 d. 2 ____ 2. What is the opportunity cost of wheat in Macedonia a. 3/4 c. 4/3 b. 2/3 d. 3 ____ 3. Which of the following is true a. Bulgaria has the absolute advantage and comparative advantage in wheat, but Macedonia has the absolute and comparative advantage in tobacco c. Bulgaria has the absolute advantage and comparative advantage in tobacco, but Macedonia has the absolute and comparative advantage in wheat b. Bulgaria has the absolute advantage in both, but Macedonia has the comparative advantage in wheat d. Bulgaria has the absolute advantage in both, but Macedonia has the comparative advantage in tobacco ____ 4. If Bulgaria and Macedonia were to trade, we know which of the following is true about the price of tobacco a. 3/2 > price > 3/4 c. 3/2 > price > 4/3 b. 4/3 > price > 2/3 d. 3/4 > price > 2/3 ____ 5. If Bulgaria and Macedonia are producing jointly and they currently are producing 5 units of tobacco, what is the opportunity cost of tobacco? a. 2/3 c. 4/3 b. 3/4 d. 3/2
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Name: ________________________ ID: A 2 Suppose that there are three agricultural regions in Turkey: the Black Sea region, the Mediteranean region and the Aegean region. In these regions, they grow two crops: olives and oranges. The opportunity cost of olives is 1/5 an orange in the Black Sea region, 1 in the Aegean region, and 4 in the Mediteranean region. The joint PPF is depicted below. Olives Oranges 500 1000 900 600 800 950 A B C D E F ____ 6. Which of the following is true? a. At point D the Mediteranean region is producing only olives and the other regions are producing only oranges c. At point D the Black Sea region is producing both olives and oranges and the other regions are producing only oranges b. At point D the Black Sea region is producing only olives and the other regions are producing only oranges d. At point D the Mediteranean region is producing only oranges, the Agean region is producing only olives and the Black Sea region is producing both olives and oranges
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This note was uploaded on 02/20/2012 for the course ECON 221 taught by Professor Gordanier during the Fall '08 term at South Carolina.

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ExamView Pro - exam1 - Name: _ Class: _ Date: _ ID: A Exam...

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