Unit 7 Learning Target 1 Practice Flashcard

Front

To focus on producing one thing to improve productivity is known as:

Back

Specialization

Answer explanation

Specialization refers to focusing on producing a single good or service, which enhances productivity by allowing individuals or businesses to become more efficient and skilled in that specific area.

Front

International trade is actually ______ acting out of their own self-interest.

Back

individuals

Answer explanation

International trade involves individuals acting in their own self-interest, seeking to maximize their benefits through trade. While businesses, governments, and labor unions play roles, the fundamental unit of trade is the individual.

Front

______ benefit from international trade through lower cost of inputs.

Back

Businesses

Answer explanation

Businesses benefit from international trade by accessing lower-cost inputs, which can reduce production costs and increase competitiveness. Consumers benefit indirectly, but the direct advantage is primarily for businesses.

Front

What has helped Japan become one of the world’s biggest exporters despite having a low population and very little land?

Back

Human Capital

Answer explanation

Japan's success as a major exporter is largely due to its highly educated workforce, which is a key component of human capital. This skilled labor force enhances productivity and innovation, compensating for the country's limited natural resources.

Front

What resource is described by the US's ability to efficiently produce and export goods due to its infrastructure like roads, bridges, train tracks, and ports?

Back

Physical Capital

Answer explanation

The statement describes infrastructure like roads and ports, which are part of physical capital. Physical capital refers to the tangible assets that facilitate production and transportation of goods and services.

Front

Based on the scenario: Brazil will have a comparative advantage in producing ______ and Mexico will have a comparative advantage in producing _____ (Options: flowers; wheat, wheat; wheat, wheat; flowers, flowers; flowers)

Back

flowers; wheat

Answer explanation

Brazil has a comparative advantage in producing flowers because it gives up less wheat to produce them. Conversely, Mexico has a comparative advantage in producing wheat as it sacrifices fewer flowers for wheat production.

Front

A country has a comparative advantage in producing a good when that country can produce that good at a lower _______ than other countries.

Back

opportunity cost

Answer explanation

A country has a comparative advantage when it can produce a good at a lower opportunity cost than others. This means it sacrifices less of other goods to produce that good, making 'opportunity cost' the correct choice.

Front

Opportunity cost to produce 50 units of steel: Country A - 25 units of aluminum, Country B - 40 units of aluminum. Who should specialize in aluminum?

Back

Country A

Answer explanation

Country A has a lower opportunity cost for producing aluminum (0.5 units of aluminum per unit of steel) compared to Country B (0.625 units of aluminum per unit of steel). Therefore, Country A should specialize in aluminum production.