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# Question : 31) John and Mary work at a bakery. John can

31) John and Mary work at a bakery. John can decorate either 10 ice-cream cakes or 4 wedding cakes; Mary can decorate either 8 ice-cream cakes or 2 wedding cakes. According to this scenario

A) the opportunity cost of decorating a wedding cake for Mary is 4 ice-cream cakes.

B) the opportunity cost of decorating a wedding cake for Mary is 1/4 ice-cream cake.

C) the opportunity cost of decorating a wedding cake for Mary is 2 1/2 ice-cream cakes.

D) the opportunity cost of decorating a wedding cake for Mary is 2/5 ice-cream cake.

32) John and Mary work at a bakery. John can decorate either 10 ice-cream cakes or 4 wedding cakes; Mary can decorate either 8 ice-cream cakes or 2 wedding cakes. According to this scenario

A) the opportunity cost of decorating an ice-cream cake for John is 1/4 wedding cake.

B) the opportunity cost of decorating an ice-cream cake for John is 2/5 wedding cake.

C) the opportunity cost of decorating an ice-cream cake for John is 2.5 wedding cakes.

D) the opportunity cost of decorating an ice-cream cake for John is 4 wedding cakes.

33) John and Mary work eight hours at a bakery. John can decorate either 10 ice-cream cakes or 4 wedding cakes; Mary can decorate either 8 ice-cream cakes or 2 wedding cakes. According to this scenario

A) Mary has the absolute advantage in decorating wedding cakes.

B) John has the absolute advantage in decorating wedding cakes.

C) Mary has the comparative advantage in decorating wedding cakes.

D) John has the comparative advantage in decorating ice-cream cakes.

34) John and Mary work eight hours at a bakery. John can decorate either 10 ice-cream cakes or 4 wedding cakes; Mary can decorate either 8 ice-cream cakes or 2 wedding cakes. According to this scenario

A) Mary has the absolute advantage in decorating wedding cakes.

B) Mary has the absolute advantage in decorating ice-cream cakes.

C) Mary has the comparative advantage in decorating ice-cream cakes.

D) John has the comparative advantage in decorating ice-cream cakes.

35) One of the benefits of specialization is

A) greater output.

B) people enjoy doing one repetitive task over and over.

C) specialists cost less to hire.

D) training costs are higher.

36) If Irene can make either four chairs or one table in an hour and Greg can make either three chairs or two tables in an hour, then

A) Irene has the absolute advantage in the production of tables.

B) Greg has the absolute advantage in the production of chairs.

C) Irene has the comparative advantage in the production of chairs.

D) Greg has the comparative advantage in the production of chairs.

37) If Irene can make either four chairs or one table in an hour and Greg can make either three chairs or two tables in an hour then

A) Irene has the absolute advantage in the production of chairs.

B) Irene has the comparative advantage in the production of tables.

C) Greg has the absolute advantage in the production of chairs.

D) Greg has the comparative advantage in the production of chairs.

38) When Adam Smith's ten pin workers specialized, they were able to increase output of pins in a day from 200 to 48,000. One reason for the increase in pin output was due to

A) the time saved when workers do not need to shift from one task to another.

B) the boredom the workers suffered when they stopped making a whole pin and only concentrated on one task such as painting the heads white.

C) new machinery.

D) the bonus they received when they produced more pins.

39) The making and selling of a pencil for ten cents would likely NOT be possible, but for

B) the production possibilities curve.

D) the division of labor.

40) When productive activities are organized according to the principle of the division of labor

A) scarcity is eliminated.

B) we do not devote enough resources for capital investment.

C) total output increases due to the advantages of specialization.

D) an inefficient outcome results.

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