Interdependence and the Gains from Trade 527
67. Refer to Table 3-17. If the production possibilities frontier is a straight line, then “?” must be
a. 180.
b. 200.
c. 220.
d. 240.
Table 3-18
The following table contains some production possibilities for an economy for a given month.
Apples
Oranges
120
450
180
?
240
150
68. Refer to Table 3-18. If the production possibilities frontier is bowed outward, then “?” could be
a. 150.
b. 225.
c. 300.
d. 375.
528 Interdependence and the Gains from Trade
69. Refer to Table 3–18. If the production possibilities frontier is a straight line, then “?” must be
a. 150.
b. 225.
c. 300.
d. 375.
Table 3-19 Summary of the Gains from Trade
Alice
Betty
Lemonade
(in pitchers)
Pizzas
Pizzas
Without Trade
Production and Consumption
200
100
180
With Trade
Production
400
0
300
Trade
Gives 193
Gets 110
Gives 110
Consumption
a
b
d
Gains from Trade
e
f
h
Interdependence and the Gains from Trade 529
70. Refer to Table 3-19. The values in the table represent the amounts of lemonade and pizzas that
Alice and Betty can produce in one week without and with specialization and trade. What are
Alice and Betty’s gains from specialization and trade?
a. Alice gains 7 pitchers of lemonade and 10 pizzas, while Betty gains 13 pitchers of lemonade and
10 pizzas.
b. Alice gains 200 pitchers of lemonade and 100 pizzas, while Betty gains 180 pitchers of
lemonade and 180 pizzas.
c. Alice gains 207 pitchers of lemonade and 110 pizzas, while Betty gains 193 pitchers of
lemonade and 190 pizzas.
d. Alice gains 400 pitchers of lemonade and 0 pizzas, while Betty gains 0 pitchers of lemonade and
300 pizzas.
Figure 3-1
Panel (a) Panel (b)
530 Interdependence and the Gains from Trade
71. Refer to Figure 3-1. The rate of tradeoff between producing chairs and producing couches is
constant in
a. Panel (a).
b. Panel (b).
c. both Panel (a) and Panel (b).
d. neither Panel (a) nor Panel (b).
72. Refer to Figure 3-1. The rate of tradeoff between producing chairs and producing couches
depends on how many chairs and couches are being produced in
a. Panel (a).
b. Panel (b).
c. both Panel (a) and Panel (b).
d. neither Panel (a) nor Panel (b).
Interdependence and the Gains from Trade 531
Figure 3-2
Brazil’s Production Possibilities Frontier
73. Refer to Figure 3-2. The fact that the line slopes downward reflects the fact that
a. for Brazil, it is more costly to produce peanuts than it is to produce cashews.
b. Brazil will produce more peanuts and fewer cashews as time goes by.
c. Brazil faces a tradeoff between producing peanuts and producing cashews.
d. Brazil should specialize in producing cashews.
532 Interdependence and the Gains from Trade
74. Refer to Figure 3-2. If the production possibilities frontier shown is for 24 hours of production,
then how long does it take Brazil to make one peanut?
a. 1/10 hour
b. 1/3 hour
c. 3 hours
d. 10 hours
75. Refer to Figure 3-2. If the production possibilities frontier shown is for 24 hours of production,
then how long does it take Brazil to make one cashew?
a. 1/10 hour
b. 1/3 hour
c. 3 hours
d. 10 hours
Interdependence and the Gains from Trade 533
76. Refer to Figure 3-2. If the production possibilities frontier shown is for two months of
production, then which of the following combinations of peanuts and cashews could Brazil produce
in two months?
a. 7 peanuts and 35 cashews
b. 5 peanuts and 100 cashews
c. 2 peanuts and 190 cashews
d. 3 peanuts and 150 cashews
77. Refer to Figure 3-2. If the production possibilities frontier shown is for two months of
production, then which of the following combinations of peanuts and cashews could Brazil not
produce in two months?
a. 5 peanuts and 88 cashews
b. 4 peanuts and 115 cashews
c. 3 peanuts and 155 cashews
d. 1 peanuts and 200 cashews
534 Interdependence and the Gains from Trade
Figure 3-3
Arturo’s Production Possibilities Frontier Dina’s Production Possibilities Frontier
78. Refer to Figure 3-3. If Dina must work 0.25 hour to produce each taco, then her production
possibilities frontier is based on how many hours of work?
a. 40 hours
b. 100 hours
c. 400 hours
d. 1600 hours
Interdependence and the Gains from Trade 535
79. Refer to Figure 3-3. If the production possibilities frontier shown for Arturo is for 100 hours of
production, then how long does it take Arturo to make one burrito?
a. 1/4 hour
b. 1/3 hour
c. 3 hours
d. 4 hours
80. Refer to Figure 3-3. If Arturo and Dina both spend all of their time producing tacos, then total
production is
a. 400 tacos and 0 burritos.
b. 400 tacos and 250 burritos.
c. 800 tacos and 0 burritos.
d. 800 tacos and 500 burritos.
536 Interdependence and the Gains from Trade
81. Refer to Figure 3-3. If Arturo and Dina each divides his/her time equally between the
production of tacos and burritos, then total production is
a. 200 tacos and 150 burritos.
b. 400 tacos and 250 burritos.
c. 400 tacos and 300 burritos.
d. 800 tacos and 500 burritos.
82. Refer to Figure 3-3. If the production possibilities frontiers shown are each for one day of
production, then which of the following combinations of tacos and burritos could Arturo and Dina
together produce in a given day?
a. 400 tacos and 350 burritos
b. 500 tacos and 250 burritos
c. 600 tacos and 150 burritos
d. 700 tacos and 100 burritos
Interdependence and the Gains from Trade 537
83. Refer to Figure 3-3. If the production possibilities frontiers shown are each for one day of
production, then which of the following combinations of tacos and burritos could Arturo and Dina
together not produce in a given day?
a. 200 tacos and 400 burritos
b. 300 tacos and 350 burritos
c. 400 tacos and 300 burritos
d. 600 tacos and 250 burritos
Figure 3-4
Lisa’s Production Possibilities Frontier Bryce’s Production Possibilities Frontier
538 Interdependence and the Gains from Trade
84. Refer to Figure 3-4. If Bryce must work 4 months to produce each sweater, then his production
possibilities frontier is based on how many months of work?
a. 4 months
b. 8 months
c. 12 months
d. 16 months
85. Refer to Figure 3-4. If the production possibilities frontier shown for Lisa is for 4 months of
work, then how long does it take Lisa to produce one jacket?
a. 1/4 month
b. 1/2 month
c. 2 months
d. 4 months
Interdependence and the Gains from Trade 539
86. Refer to Figure 3-4. If Lisa and Bryce both spend all of their time producing jackets, then total
production is
a. 2 jackets.
b. 6 jackets.
c. 24 jackets.
d. 26 jackets.
87. Refer to Figure 3-4. If Lisa and Bryce each divides his or her time equally between producing
jackets and producing sweaters, then total production is
a. 2 sweaters and 8 jackets.
b. 3 sweaters and 13 jackets.
c. 5 sweaters and 8 jackets.
d. 6 sweaters and 26 jackets.
540 Interdependence and the Gains from Trade
88. Refer to Figure 3-4. If the production possibilities frontiers shown are each for one year of
working, then which of the following combinations of jackets and sweaters could Lisa and Bryce
together produce in a given year?
a. 1 sweater and 22 jackets
b. 2 sweaters and 20 jackets
c. 4 sweaters and 12 jackets
d. 5 sweaters and 7 jackets
89. Refer to Figure 3-4. If the production possibilities frontiers shown are each for one year of
production, then which of the following combinations of sweaters and jackets could Lisa and
Bryce together not produce in a given year?
a. 1 sweater and 21 jackets
b. 2 sweaters and 20 jackets
c. 3 sweaters and 12 jackets
d. 5 sweaters and 4 jackets
Interdependence and the Gains from Trade 541
Figure 3-5
Hosne’s Production Possibilities Frontier Merve’s Production Possibilities Frontier
90. Refer to Figure 3-5. If Hosne must work 0.5 hour to make each purse, then her production
possibilities frontier is based on how many hours of work?
a. 2 hours
b. 5 hours
c. 20 hours
d. 50 hours
542 Interdependence and the Gains from Trade
91. Refer to Figure 3-5. If the production possibilities frontier shown for Merve is for 8 hours of
work, then how long does it take Merve to make one purse?
a. 1/2 hour
b. 2 hours
c. 4 hours
d. 8 hours
92. Refer to Figure 3-5. If Hosne and Merve both spend all of their time making wallets, then total
production is
a. 7 wallets.
b. 8 wallets.
c. 14 wallets.
d. 28 wallets.
Interdependence and the Gains from Trade 543
93. Refer to Figure 3-5. If Hosne and Merve each divides her time equally between making purses
and making wallets, then total production is
a. 4 purses and 8 wallets.
b. 7 purses and 7 wallets.
c. 10 purses and 6 wallets.
d. 14 purses and 14 wallets.
Figure 3-6
Maxine’s Production Possibilities Frontier Daisy’s Production Possibilities Frontier
544 Interdependence and the Gains from Trade
94. Refer to Figure 3-6. If Daisy must work 2.5 hours to make each pie, then her production
possibilities frontier is based on how many hours of work?
a. 6 hours
b. 7.5 hours
c. 37.5 hours
d. 50 hours
95. Refer to Figure 3-6. If the production possibilities frontier shown for Maxine is for 3 hours of
work, then how long does it take Maxine to make one pie?
a. 1/4 hour
b. 1/3 hour
c. 3 hours
d. 4 hours
Interdependence and the Gains from Trade 545
96. Refer to Figure 3-6. If Maxine and Daisy each divides her time equally between making pies
and making tarts, then total production is
a. 6 pies and 10 tarts.
b. 7.5 pies and 3 tarts.
c. 7.5 pies and 10 tarts.
d. 13.5 pies and 13 tarts.
97. Refer to Figure 3-6. If the production possibilities frontiers shown are each for one day of work,
then which of the following combinations of pies and tarts could Maxine and Daisy together not
make in a given day?
a. 2 pies and 25 tarts
b. 10 pies and 22 tarts
c. 12 pies and 15 tarts
d. 15 pies and 16 tarts
546 Interdependence and the Gains from Trade
98. Refer to Figure 3-6. If the production possibilities frontiers shown are each for one day of work,
then which of the following combinations of pies and tarts could Maxine and Daisy together not
make in a given day?
a. 2 pies and 25 tarts
b. 10 pies and 22 tarts
c. 12 pies and 15 tarts
d. 15 pies and 16 tarts
Figure 3-7
Bintu’s Production Possibilities Frontier Juba’s Production Possibilities Frontier