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Unit 1 Econ Assessment questions

 QUESTION 1

  1. Imagine that you just paid $50 for a new pair of jeans. According to the circular flow diagram, what decisions were made concerning the jeans you purchased, and who made decisions about the jeans you bought?

    Your response must be at least 75 words in length.

 

QUESTION 2

  1. Background information: A worker in the United States and a worker in China can each produce 1,000 pairs of jeans per week. A worker in the United States can produce 50 cell phones in a week, and a worker in China can produce 100 cell phones in a week. Answer the following questions based on this information.

    Part A: If each country attempted to produce both jeans and cell phones, how many jeans and cell phones could each country produce? What would be the total number of jeans and cell phones produced by the two countries combined? (Show your work.)

    Part B: Calculate the opportunity cost of producing jeans for each country. (Show your work.)

    Part C: Calculate the opportunity cost of producing cell phones for each country. (Show your work.)

    Part D: Determine how many jeans should be produced by each nation. (Show your work).

    Part E: If each nation should specialize in producing jeans and cell phones, explain why; use economic terminology you have learned in this unit in your explanation.

    Part F: Finally, how many total jeans and cell phones will be produced by the two nations combined after specialization?

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