2. Introductory Economic Models
PPF - Comparative Advantage and Trade
2. Introductory Economic Models
PPF - Comparative Advantage and Trade: Study with Video Lessons, Practice Problems & Examples
Trading helps us reach levels of consumption that were previously unattainable. Team work makes the dream work!
1
Problem
ProblemIf Joe and Carla plan to specialize and trade, what should Joe produce?
A
Only Scrambled Eggs
B
Only Fresh Squeezed
C
6 Eggs and 4 OJ
D
2 Eggs and 4 OJ
2
Problem
ProblemIf Joe and Carla plan to specialize and trade, what should Carla produce?
A
Only Scrambled Egg
B
Only Fresh Squeezed Orange juice
C
6 Eggs and 6 OJ
D
10 Eggs and 2 OJ
3
Problem
ProblemAssume that Joe and Carla will trade Scrambled Eggs and Fresh Squeezed Orange Juice at a rate of 1.2 Eggs for 1 OJ. If Joe's consumption after trade includes six eggs, what will be Carla's consumption after trade?
A
6 Eggs and 6 OJ
B
0 Eggs and 12 OJ
C
6 Eggs and 7 OJ
D
1.2 Eggs and 11 OJ
