Economics Worksheet With Answers (Page 3 of 6) in pdf

Economics Worksheet With Answers Page 3

8. Refer to Figure 1. Ginger has an absolute advantage in

a. ballet slippers and Fred has an absolute advantage in tap shoes.

b. tap shoes and Fred has an absolute advantage in ballet slippers.

c. neither good and Fred has an absolute advantage in both goods.

d. both goods and Fred has an absolute advantage in neither good.

9. Refer to Figure 1. Ginger has an absolute advantage in

a. tap shoes and Fred has a comparative advantage in ballet slippers.

b. both goods and Fred has a comparative advantage in neither good.

c. ballet slippers and Fred has a comparative advantage in tap shoes.

d. neither good and Fred has a comparative advantage in both goods.

10. Refer to Figure 1. In order to maximize total output,

a. Ginger should specialize in tap shoes and Fred should specialize in ballet slippers.

b. Ginger should specialize in both goods and Fred should specialize in neither good.

c. Ginger should specialize in ballet slippers and Fred should specialize in tap shoes.

d. Ginger should specialize in neither good and Fred should specialize in both goods.

11. Refer to Figure 1. Suppose Fred specializes in the good in which he has a comparative

advantage, and Ginger specializes in the good in which she has a comparative

advantage. Then

a. total production of ballet slippers would be 6 and total production of tap shoes

would be 6.

b. total production of ballet slippers would be 8 and total production of tap shoes

would be 6.

c. total production of ballet slippers would be 8 and total production of tap shoes

would be 8.

d. total production of ballet slippers would be 8 and total production of tap shoes

would be 10.

12. If the price elasticity of demand for a good is 0.94, then which of the following

events is consistent with a 4 percent decrease in the quantity of the good demanded?

a. a 0.235 percent increase in the price of the good

b. a 2.350 percent increase in the price of the good

c. a 3.760 percent increase in the price of the good

d. a 4.255 percent increase in the price of the good

Economics Worksheet With Answers Page 3