What is it called when one producer has a lower opportunity cost of production than another producer for a product quizlet?

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Terms in this set (25)

The process of making the best of our limited resources by doing the things we are best at and hiring other people to do the things we are not particularly good at is called
A) absolute advantage.
B) comparative advantage.
C) specialization.
D) protectionism

specialization

The ability to produce a good using fewer resources than someone else is called
A) absolute advantage.
B) comparative advantage.
C) specialization.
D) protectionism

absolute advantage

The ability to produce a good at a lower opportunity cost than another producer is called
A) absolute advantage.
B) comparative advantage.
C) specialization.
D) protectionism

comparative advantage

One Bracelet One Tiara
Andrea 2 hours 12 hours
Hector 3 hours 15 hours

Does either Andrea or Hector have an absolute advantage and if so, in what product?
A) Andrea only has an absolute advantage in producing bracelets.
B) Hector only has an absolute advantage in producing bracelets.
C) Andrea has an absolute advantage in producing both products.
D) Hector only has an absolute advantage in producing tiaras

Andrea has an absolute advantage in producing both products.

One Bracelet One Tiara
Andrea 2 hours 12 hours
Hector 3 hours 15 hours

What is Hector's opportunity cost of producing one tiara?
A) 1/5 of a bracelet
B) 1.5 bracelets
C) 4 bracelets
D) 5 bracelets

5 bracelets

One Bracelet One Tiara
Andrea 2 hours 12 hours
Hector 3 hours 15 hours

What is Hector's opportunity cost of producing one bracelet?
A) 1/5 of a tiara
B) 1.5 tiaras
C) 5 tiaras
D) 6 tiaras

1/5 of a tiara

One Bracelet One Tiara
Andrea 2 hours 12 hours
Hector 3 hours 15 hours

Andrea has a comparative advantage in the production of
A) bracelets.
B) tiaras.
C) both products.
D) neither product.

bracelets

The amount Jacqueline receives for selling cupcakes beyond the minimum she would be willing to sell the cupcakes for is called
A) consumer surplus.
B) producer surplus.
C) cooperative surplus.
D) deadweight loss.

producer surplus.

If Jacqueline is willing to accept $1 for a cupcake and Jameson is willing to pay $3 for a cupcake, and they negotiate a price of $2 for a cupcake, the cooperative surplus is
A) $1.
B) $2.
C) $3.
D) $4.

$2

It is possible to have a comparative advantage in producing a good or service without having an absolute advantage.
true or false

true

Explain the concepts of absolute advantage and comparative advantage. Is it possible for a firm to have an absolute advantage in producing something without having a comparative advantage? Why or why not?

Absolute advantage is the ability to produce goods using fewer resources, and comparative adavantage is ability to produce a good at a lower opportunity cost than another producer. Yes, for example you may have to

Explain the concept of consumer surplus.

...

Explain the concept of cooperative surplus

...

Explain the concept of producer surplus

...

13) A compulsory payment to government that is generally linked to engaging in some activity is referred to as a
A) tax.
B) subsidy.
C) deadweight loss.
D) quota.

tax

Surplus value that is lost because something is keeping the market from functioning as well as it can is called
A) a tax.
B) a subsidy.
C) rent seeking.
D) deadweight loss.

a subsidy

A market where goods are sold in violation of governmentally-imposed restrictions is a(n)
A) black market.
B) export market.
C) rent-seeking market.
D) deadweight market.

a black market

If black markets help people meet their needs, they will tend to ________ created by the restrictive government policies.
A) increase the absolute advantage
B) reduce the deadweight losses
C) reduce the cooperative surpluses
D) increase the tax revenues

reduce the deadweight losses

A payment that a person receives from the government for engaging in a particular activity is called a
A) bribe.
B) subsidy.
C) consumer surplus.
D) tariff.

subsidy

A tax on an imported good is a(n)
A) quota.
B) export.
C) tariff.
D) subsidy.

tariff

In 2014, tire industry lobbyists pressured the United States government to consider imposing an additional tariff of up to 86% on top of the current 4% tariff on imported Chinese-made tires. This type of behavior where industry lobbyists attempt to influence law for their own economic advantage is called
A) deadweight protection.
B) blackmail.
C) quota manipulation.
D) rent seeking.

quota manipulation

In 2014, tire industry lobbyists pressured the United States government to consider imposing an additional tariff of up to 86% on top of the current 4% tariff on imported Chinese-made tires. The loss that is associated with fewer transactions occurring because of the tariff is called
A) deadweight loss.
B) opportunity loss.
C) lost rent.
D) a subsidized loss

deadweight loss

An American farmer buys an irrigation system from a Norwegian irrigation company based in Oslo. To Americans, the irrigation system is a(n)
A) import.
B) export.
C) quota.
D) tariff.

import

To assist pineapple growers in Hawaii, the U.S. government decides to limit the number of pineapples allowed into the country that are grown in Central American countries. Such a restriction is called a(n)
A) import.
B) export.
C) quota.
D) tariff.

quota

What is the "chicken tax" and why did it come into existence?

Chicken tax is a tariff put on a good to decrease buying produce from other countries, and to increase the buying of products from their own country.

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What is it called when one producer has a lower opportunity cost of production than another producer for a product?

What is it called when one producer has a lower opportunity cost?

Is the ability to produce a good at a lower opportunity cost than another producer?

When describing the opportunity cost What are the two producers?