Specialization and Trade: Crash Course Economics #2

When did people see a significant and sustained increase in their standard of living?

• the industrial revolution

• the renaissance

• the 60's

• last week

Who was the first modern economist?

• Adam Smith

• Orville Wright

• Orville Redenbacher

• Thomas Theroux

What makes countries wealthy?

• the division of labor (specialization)

• a large military

• a large labor force

• a trade surplus

Specialization has been common for thousands of year of human history.

• false

• true

While specialization makes people more productive, it's _______________ that makes them better off.

• trade

• knowledge

• emus

• democracy

What is the purpose of a model?

• Models are visuals to help us simplify and explain concepts.

• Models ensure that aircraft can fly before we get on them.

• Models ensure that clothing is wearable before regular people buy them.

• Models make complicated ideas more complicated.

What does PPF stand for?

• production possibilities frontier

• positive position function

• proper paper flapper

• projected product framework

What is the big idea that the PPF is trying to convey?

• There are trade-offs between producing two goods, and that same logic applies for any number of goods.

• If you study only two things with the PPF, then economics will collapse.

• Emus rock!

• Positive position functioning can be used to predict more stable economic models.

Any combination of goods that lives inside the PPF curve is ...

• inefficient

• efficient

• impossible

• an imaginary construct that attempts to reconcile the vast distance between the ideas of capitalism and communism

Countries should specialize in producing things in which they have a comparative advantage and then trade with other countries that specialize in something else.

• true

• false