Midterm1_v1_Fall2013_Solution

B point b to point a in panel 1 c point a to point c

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Unformatted text preview: r. Zenland produces and consumes 50 units of grain and no incense per year. If each country made the decision to specialize in producing the good in which it has a comparative advantage, then the combined yearly output of the two countries would increase by a. 30 units of grain and 100 units of incense. b. 30 units of grain and 150 units of incense. c. 50 units of grain and 90 units of incense. d. 50 units of grain and 130 units of incense. 10. [4%] Refer to the figure below. Perry’s Production Possibilities Frontier Jordan’s Production Possibilities Frontier Which of the following is not correct? a. Perry and Jordan could each consume 2 novels and 6 poems without trade. b. Jordan could consume 2 novels and 6 poems both with and without trade. c. Perry and Jordan could each consume 2 novels and 6 poems with trade. d. Perry and Jordan could each consume 12 poems without trade....
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