AP®︎ Macroeconomics: Topic 1.3 Practice Test
Prepare for your quiz, test, or the AP exam with focused practice questions on Topic 1.3 of AP Macroeconomics – Comparative Advantage and Gains from Trade.
Questions List
Topic 1.3
Question 1 Easy
This question tests the following: MKT-1.A.1
What term describes a country's ability to produce more of a good than another country using the same resources?
What You’re Being Tested On:
Explore the learning objectives taken directly from the College Board’s AP® Macroeconomics Curriculum. Ensure you’re prepared for the exact topics covered on the AP® exam, in-class tests, and quizzes, and gain confidence in your mastery of the material.
Topic 1.3: Comparative Advantage and Gains from Trade
Learning Objective: MKT-1.A
a. Define absolute advantage and comparative advantage. b. Determine (using data from PPCs or tables as appropriate) absolute and comparative advantage.
Essential Knowledge: MKT-1.A.1
Absolute advantage describes a situation in which an individual, business, or country can produce more of a good or service than any other producer with the same quantity of resources.
Essential Knowledge: MKT-1.A.2
Comparative advantage describes a situation in which an individual, business, or country can produce a good or service at a lower opportunity cost than another producer.
Learning Objective: MKT-1.B
a. Explain (using data from PPCs or tables as appropriate) how specialization according to comparative advantage with appropriate terms of trade can lead to gains from trade. b. Calculate (using data from PPCs or tables as appropriate) mutually beneficial terms of trade.
Essential Knowledge: MKT-1.B.1
Production specialization according to comparative advantage results in exchange opportunities that lead to consumption opportunities beyond the PPC.
Essential Knowledge: MKT-1.B.2
Comparative advantage and opportunity costs determine the terms of trade for exchange under which mutually beneficial trade can occur.
