Macro Unit 1- Practice Questions #2

The video tutorial covers practice questions on economic concepts such as absolute and comparative advantage, opportunity cost, specialization, and supply and demand. It provides strategies for solving problems, including drawing graphs and using quick calculations. The tutorial emphasizes understanding key economic principles and applying them to various scenarios.

What is the absolute advantage of Peru in the production of wheat compared to Brazil?

Explain the difference between absolute advantage and comparative advantage.

How do you calculate the opportunity cost of producing one ton of wheat in Brazil?

Explain the significance of opportunity cost in production decisions.

What should Peru specialize in according to the comparative advantage theory?

Describe the concept of terms of trade and how it benefits both countries.

What happens to the demand for apples when consumer preferences change?

What factors can lead to a leftward shift in the supply curve for cars?

How does a binding price floor affect the quantity demanded and supplied?

What is the impact of removing a binding price ceiling in a competitive market?