1.7 Comparative and Absolute Advantage

Question 1

When discussing comparative and absolute advantage, which best describes specialization?

Revolt · Accepted Answer

limiting the types of goods and services produced

Question 2

Which calculation helps determine which producer has the absolute advantage?

Revolt · Accepted Answer

Amount produced divided by resources used

Question 3

[BLANK]

Revolt · Accepted Answer

Specialization

Question 4

This table shows the cost of producing ice cream for several manufacturers.Manufacturer Amount Produced CostThe Dairy 100 gallons $10 Ice Cream, Inc. 100 gallons $15 Frozen Treats 150 gallons $12 Bob & Gary’s 125 gallons $15 Which manufacturer has the absolute advantage?

Revolt · Accepted Answer

Frozen Treats

Question 5

This table shows the number of cookies several bakeries sell each day.Bakery Number of Cookies Sold Mrs. Track’s 90 Chips 100 The Bakeshop 75 Uncle John’s 125 All else being equal, which bakery has the absolute advantage?

Revolt · Accepted Answer

Uncle John’s

Question 6

True or False? Higher opportunity costs equal a greater comparative advantage.

Revolt · Accepted Answer

False

Question 7

Which scenario is the best example of an opportunity cost?

Revolt · Accepted Answer

A computer company produces fewer laptops to meet tablet demand.

Question 8

Which best describes how producers benefit from specialization?

Revolt · Accepted Answer

Producers can increase their profits.

Question 9

Which of these best describes an opportunity cost?

Revolt · Accepted Answer

a trade-off

Question 10

Which most likely results from producers engaging in specialization?

1.7 Comparative and Absolute Advantage Answers

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