ECON 2020 WEEK 1 EXAM QUESTIONS
WITH DETAILED VERIFIED ANSWERS
Suppose an american worker can make 20 pairs of shoes or grow 100 apples per day. A
Canadian worker, on the other hand, can produce 10 pairs of shoes or grow 20 apples per
day. Which of the following statements is true?
a. The U.S. has the absolute advantage in the production of both shoes and apples
b. Canada has the absolute advantage in the production of both shoes and apples
c. The U.S. has the absolute advantage in the production of shoes and Canada has the
absolute advantage in the production of apples
d. Canada has the absolute advantage in the production of shoes and the U.S. has the
absolute advantage in the production of apples
A
Suppose an American worker can make 20 pairs of shoes or grow 100 apples per day. A
Canadian worker, on the other hand, can produce 10 pairs of shoes or grow 20 apples per
day. Which of the following statements is true?
a. The U.S has a comparative advantage in the production of shoes
b. Canada has a comparative advantage in the production of shoes
c. Comparative advantage doesn't exist in this scenario
d. Both counties have a comparative advantage in the production of shoes
B
Suppose an American worker can make 50 pairs of gloves or grow 300 radishes per day. A
Bangladeshi worker, on the other hand, can produce 100 pairs of gloves or grow 200
radishes per day. The opportunity cost of one pair of gloves is:
a. 6 radishes for the U.S. and 2 radishes for Bangladesh
b. 60 Radishes for the U.S. and 20 radishes for Bangladesh
, c. 1/6 Radishes for the U.S. and 1/2 radishes for Bangladesh
d. 6000 radishes for the U.S. and 2000 radishes for Bangladesh
A
When a country is acting efficiently:
a. It is producing at a point on or below its production possibilities frontier
b. It is getting the most output by using all its available resources
c. It has unemployed workers
d. It is able to reach a point beyond its production possibilities frontier
B
The U.S. and Canada trade hockey skates and apple pie. If the U.S. has an absolute and a
comparative advantage in the production of apple pie then:
a. Canada must have the comparative advantage in the production of skates
b. Canada must have the absolute advantage in the production of skates
c. Canada must have the absolute and comparative advantage in the production of skates
d. The U.S. must have the comparative advantage in the production of skates, too
A
An increase in productivity as a result of a new technology would cause the production
possibilities frontier to:
a. Shift in
b. Shift out
c. not move until society chooses to move it
d. become more meaningful in policy decisions
B
A country that specializes:
WITH DETAILED VERIFIED ANSWERS
Suppose an american worker can make 20 pairs of shoes or grow 100 apples per day. A
Canadian worker, on the other hand, can produce 10 pairs of shoes or grow 20 apples per
day. Which of the following statements is true?
a. The U.S. has the absolute advantage in the production of both shoes and apples
b. Canada has the absolute advantage in the production of both shoes and apples
c. The U.S. has the absolute advantage in the production of shoes and Canada has the
absolute advantage in the production of apples
d. Canada has the absolute advantage in the production of shoes and the U.S. has the
absolute advantage in the production of apples
A
Suppose an American worker can make 20 pairs of shoes or grow 100 apples per day. A
Canadian worker, on the other hand, can produce 10 pairs of shoes or grow 20 apples per
day. Which of the following statements is true?
a. The U.S has a comparative advantage in the production of shoes
b. Canada has a comparative advantage in the production of shoes
c. Comparative advantage doesn't exist in this scenario
d. Both counties have a comparative advantage in the production of shoes
B
Suppose an American worker can make 50 pairs of gloves or grow 300 radishes per day. A
Bangladeshi worker, on the other hand, can produce 100 pairs of gloves or grow 200
radishes per day. The opportunity cost of one pair of gloves is:
a. 6 radishes for the U.S. and 2 radishes for Bangladesh
b. 60 Radishes for the U.S. and 20 radishes for Bangladesh
, c. 1/6 Radishes for the U.S. and 1/2 radishes for Bangladesh
d. 6000 radishes for the U.S. and 2000 radishes for Bangladesh
A
When a country is acting efficiently:
a. It is producing at a point on or below its production possibilities frontier
b. It is getting the most output by using all its available resources
c. It has unemployed workers
d. It is able to reach a point beyond its production possibilities frontier
B
The U.S. and Canada trade hockey skates and apple pie. If the U.S. has an absolute and a
comparative advantage in the production of apple pie then:
a. Canada must have the comparative advantage in the production of skates
b. Canada must have the absolute advantage in the production of skates
c. Canada must have the absolute and comparative advantage in the production of skates
d. The U.S. must have the comparative advantage in the production of skates, too
A
An increase in productivity as a result of a new technology would cause the production
possibilities frontier to:
a. Shift in
b. Shift out
c. not move until society chooses to move it
d. become more meaningful in policy decisions
B
A country that specializes:
