MBA 680 Final Exam | All possible
Questions and Answers | 2026 Update |
100% Correct
The following figure shows the production-possibility curves for Canada (AB) and
the rest of the world (CD). Suppose Canada begins to trade with the rest of the
world. If, in the international market, one bushel of corn is exchanged for one liter
of maple syrup, Canada will produce _____ bushels of corn and the rest of the
world will produce _____ liters of maple syrup.
A. 35; 32.5
B. 0; 0
C. 70; 50
D. 90; 100
B. 0; 0
*Graph 1*
The table below shows the number of umbrellas and bushels of corn produced in
the United Kingdom and the rest of the world per labor hour. If the United
Kingdom and the rest of the world begin to trade with each other, the
international price of umbrellas will lie between _____ and _________.
Productivity -> UK -> World
,Umbrellas/LH -> 0.25 -> 1.00
BushCorn/LH -> 0.50 -> 0.67
2/3 of a bushel of corn per umbrella; two bushels of corn per umbrella.
The table below shows the number of labor hours required to produce one gallon
of wine and one pound of cheese in the United States and France. What is the
relative price of cheese (the price of cheese in terms of wine) in France under a
no-trade situation?
LH to Make -> USA -> France
1G of Wine -> 4.00 -> 1.00
1lb Cheese -> 1.00 -> 2.00
Two gallons of wine per pound
The table below shows the number of labor hours required to produce one gallon
of wine and one pound of cheese in the United States and France. The
opportunity cost of producing cheese in the United States is
LH to Make -> USA -> France
1G of Wine -> 4.00 -> 1.00
1lb Cheese -> 1.00 -> 2.00
0.25 gallon of wine.
The table below shows the number of labor hours required to produce one gallon
of wine and one pound of cheese in the United States and France. The United
States has an absolute advantage in the production of
,LH to Make -> USA -> France
1G of Wine -> 4.00 -> 1.00
1lb Cheese -> 1.00 -> 2.00
Only cheese.
Consider a two-country, two-commodity model. The table below shows the units
of Good X and Good Y produced in Country A and Country B per labor hour. If
Country B transfers one labor hour from the production of Good X to the
production of Good Y, total world production of Good Y will _____ by _____
unit(s).
Productivity -> Country A -> Country B
Good X -> 1.00 -> 0.50
Good Y -> 0.20 -> 0.70
increase; 0.7
Vineland and Moonited Republic produce wine and cheese. The opportunity cost
for the production of a bottle of wine in Vineland is two pounds of cheese, and in
the Moonited Republic is 2.5 pounds of cheese. Based on this information, it can
be concluded that
Vineland has a comparative advantage in the production of wine.
Labor productivity refers to:
the number of units of output a worker can produce in one hour.
, When Adam Smith presented his theory of absolute advantage, he assumed that
all "value" in an economy was determined by and measured in terms of the _____
used in the production of the various goods.
labor hours
If Country X has higher labor productivity in the production of umbrellas than the
rest of the world, we would say that Country X has a(n) _____ in the production of
umbrellas.
absolute advantage
In the figure below, AB is the production-possibility curve of Canada. The line PQ
shows the price ratio of one bushel of wheat/bale of cotton. The international
price ratio is 0.25 bushels of wheat/bale of cotton as shown by the line RS. I1 and
I2 are two of the community indifference curves of Canada. After Canada engages
in free trade, it will:
produce at point S1 and consume at point C1.
*Graph 2*
In the figure below, AB is the production-possibility curve of Canada. I1 and I2 are
two of the community indifference curves of Canada. In the absence of trade
Canada will:
produce and consume at point C0.
*Graph 3*
A country which has a higher ratio of capital to other factors of production than
does the rest of the world is
relatively capital-abundant.
Questions and Answers | 2026 Update |
100% Correct
The following figure shows the production-possibility curves for Canada (AB) and
the rest of the world (CD). Suppose Canada begins to trade with the rest of the
world. If, in the international market, one bushel of corn is exchanged for one liter
of maple syrup, Canada will produce _____ bushels of corn and the rest of the
world will produce _____ liters of maple syrup.
A. 35; 32.5
B. 0; 0
C. 70; 50
D. 90; 100
B. 0; 0
*Graph 1*
The table below shows the number of umbrellas and bushels of corn produced in
the United Kingdom and the rest of the world per labor hour. If the United
Kingdom and the rest of the world begin to trade with each other, the
international price of umbrellas will lie between _____ and _________.
Productivity -> UK -> World
,Umbrellas/LH -> 0.25 -> 1.00
BushCorn/LH -> 0.50 -> 0.67
2/3 of a bushel of corn per umbrella; two bushels of corn per umbrella.
The table below shows the number of labor hours required to produce one gallon
of wine and one pound of cheese in the United States and France. What is the
relative price of cheese (the price of cheese in terms of wine) in France under a
no-trade situation?
LH to Make -> USA -> France
1G of Wine -> 4.00 -> 1.00
1lb Cheese -> 1.00 -> 2.00
Two gallons of wine per pound
The table below shows the number of labor hours required to produce one gallon
of wine and one pound of cheese in the United States and France. The
opportunity cost of producing cheese in the United States is
LH to Make -> USA -> France
1G of Wine -> 4.00 -> 1.00
1lb Cheese -> 1.00 -> 2.00
0.25 gallon of wine.
The table below shows the number of labor hours required to produce one gallon
of wine and one pound of cheese in the United States and France. The United
States has an absolute advantage in the production of
,LH to Make -> USA -> France
1G of Wine -> 4.00 -> 1.00
1lb Cheese -> 1.00 -> 2.00
Only cheese.
Consider a two-country, two-commodity model. The table below shows the units
of Good X and Good Y produced in Country A and Country B per labor hour. If
Country B transfers one labor hour from the production of Good X to the
production of Good Y, total world production of Good Y will _____ by _____
unit(s).
Productivity -> Country A -> Country B
Good X -> 1.00 -> 0.50
Good Y -> 0.20 -> 0.70
increase; 0.7
Vineland and Moonited Republic produce wine and cheese. The opportunity cost
for the production of a bottle of wine in Vineland is two pounds of cheese, and in
the Moonited Republic is 2.5 pounds of cheese. Based on this information, it can
be concluded that
Vineland has a comparative advantage in the production of wine.
Labor productivity refers to:
the number of units of output a worker can produce in one hour.
, When Adam Smith presented his theory of absolute advantage, he assumed that
all "value" in an economy was determined by and measured in terms of the _____
used in the production of the various goods.
labor hours
If Country X has higher labor productivity in the production of umbrellas than the
rest of the world, we would say that Country X has a(n) _____ in the production of
umbrellas.
absolute advantage
In the figure below, AB is the production-possibility curve of Canada. The line PQ
shows the price ratio of one bushel of wheat/bale of cotton. The international
price ratio is 0.25 bushels of wheat/bale of cotton as shown by the line RS. I1 and
I2 are two of the community indifference curves of Canada. After Canada engages
in free trade, it will:
produce at point S1 and consume at point C1.
*Graph 2*
In the figure below, AB is the production-possibility curve of Canada. I1 and I2 are
two of the community indifference curves of Canada. In the absence of trade
Canada will:
produce and consume at point C0.
*Graph 3*
A country which has a higher ratio of capital to other factors of production than
does the rest of the world is
relatively capital-abundant.
