ECON 1002 MICROECONOMICS FINAL EXAM
3 COMPLETE QUESTION BANK AND
EXPLANATIONS 2026
◉ Absolute Advantage. Answer: The theory that a person will
specialize in producing the good for which they have the lowest
resource cost.
◉ Comparative Advantage. Answer: A person will specialize in
producing the good for which they have the lowest opportunity cost.
◉ Comparative Advantage, Absolute Advantage. Answer: People
specialize in their _________, not their _____________
◉ Export. Answer: To sell something to a buyer in another country.
◉ Import. Answer: To buy something from a seller in another
country.
◉ Free Trade. Answer: Trade unrestricted by physical force, such as
government intervention or special taxes.
, ◉ American consumers, American producers.. Answer: Exports
harm ____________. Benefit ____________.
◉ American producers, American consumers.. Answer: Imports
harm __________. Benefit ____________.
◉ Trade Barrier. Answer: Any government action that restricts
trade.
◉ Protectionism. Answer: Support for trade barriers
◉ Tariff. Answer: A tax on imports.
◉ Reciprocal Free Trade. Answer: When two or more countries
lower their trade barriers at the same times.
◉ Total Cost. Answer: The cost of producing a certain quantity of
units of a good.
◉ Fixed costs. Answer: Costs that do not vary with the quantity of
units produced.
◉ Variable Costs. Answer: Costs that vary with the quantity of units
produced.
3 COMPLETE QUESTION BANK AND
EXPLANATIONS 2026
◉ Absolute Advantage. Answer: The theory that a person will
specialize in producing the good for which they have the lowest
resource cost.
◉ Comparative Advantage. Answer: A person will specialize in
producing the good for which they have the lowest opportunity cost.
◉ Comparative Advantage, Absolute Advantage. Answer: People
specialize in their _________, not their _____________
◉ Export. Answer: To sell something to a buyer in another country.
◉ Import. Answer: To buy something from a seller in another
country.
◉ Free Trade. Answer: Trade unrestricted by physical force, such as
government intervention or special taxes.
, ◉ American consumers, American producers.. Answer: Exports
harm ____________. Benefit ____________.
◉ American producers, American consumers.. Answer: Imports
harm __________. Benefit ____________.
◉ Trade Barrier. Answer: Any government action that restricts
trade.
◉ Protectionism. Answer: Support for trade barriers
◉ Tariff. Answer: A tax on imports.
◉ Reciprocal Free Trade. Answer: When two or more countries
lower their trade barriers at the same times.
◉ Total Cost. Answer: The cost of producing a certain quantity of
units of a good.
◉ Fixed costs. Answer: Costs that do not vary with the quantity of
units produced.
◉ Variable Costs. Answer: Costs that vary with the quantity of units
produced.
