chap002 - Chapter 002 Comparative Advantage Multiple Choice...

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Unformatted text preview: Chapter 002 Comparative Advantage Multiple Choice Questions 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 Scout has an absolute advantage over Dill, A. Scout has more money than Dill. B. the problem of scarcity applies to Dill but not to Scout. C. the problem of scarcity applies to Scout, but not to Dill. D. Scout can accomplish more in a given period of time than can Dill. 3. If Leslie can produce two pairs of pants in an hour while Eva can make one pair an hour, then it must be the case that A. Leslie has a comparative advantage. B. Leslie has an absolute advantage. C. Eva has a comparative advantage. D. Leslie has both comparative and absolute advantage. 4. 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. 5. Having a comparative advantage in a particular task means that A. you are better at it than other people. B. you give up more to accomplish that task than do others. C. you give up less to accomplish that task than do others. D. you have specialized in that task, while others have not. 2-1 Chapter 002 Comparative Advantage 6. Larry has a comparative advantage in writing a term paper if he A. can write a paper faster than the other students in class. B. has an absolute advantage in writing a term paper. C. always earns an A on his papers. D. has a low opportunity cost for writing a term paper. 7. 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. 8. Which of the following statements is always true? A. Absolute advantage implies comparative advantage. B. Comparative advantage does not require absolute advantage. C. Absolute advantage requires comparative advantage. D. Comparative advantage requires absolute advantage. 9. If Jane can produce 3 pairs of shoes hourly, while Bob can produce 2, then one can infer that the __________ advantage belongs to __________. A. absolute; Jane B. comparative; Jane C. comparative; Bob D. comparative and absolute; Jane 2-2 Chapter 002 Comparative Advantage 10. 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....
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This note was uploaded on 02/28/2012 for the course ECO 211 taught by Professor Arafat during the Summer '08 term at Anne Arundel CC.

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chap002 - Chapter 002 Comparative Advantage Multiple Choice...

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