Intro To Macroeconomics Worksheet With Answer Key Page 2
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1
2
3
4Production Possibilities Frontier (Chap 2)
6.
On the production possibilities
frontier shown, the opportunity cost to the
economy of getting 30 additional
toothbrushes by moving from point A to
point D is
a. 10 toasters.
b. 15 toasters.
c. 20 toasters.
d. 25 toasters.
ANSWER: c.
20 toasters.
Use the following table for multiple choice problems 7-10
Labor Hours Needed to Make 1 Pound
Pounds produced in 40 hours:
of:
Meat
Potatoes
Meat
Potatoes
Farmer
8
2
5
20
Rancher
4
5
10
8
7.
According to the table, the opportunity cost of 1 pound of meat for the farmer is
a. 1/4 hour of labor.
b. 4 hours of labor.
c. 4 pounds of potatoes.
d. 1/4 pound of potatoes.
ANSWER: c.
4 pounds of potatoes.
8.
According to the table, the opportunity cost of 1 pound of meat for the rancher is
a. 4 hours of labor.
b. 5 hours of labor.
c. 5/4 pounds of potatoes.
d. 4/5 pound of potatoes.
ANSWER: d.
4/5 pound of potatoes.
9.
According to the table, the Farmer has an absolute advantage in
a. meat, and the Rancher has an absolute advantage in potatoes.
b. potatoes, and the Rancher has an absolute advantage in meat.
c. meat, and the Rancher has an absolute advantage in meat.
d. neither good, and the Rancher has an absolute advantage in both goods.
ANSWER: b.
potatoes, and the Rancher has an absolute advantage in meat.
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