chapter 2 explain

Short Answer Questions MICROECONOMICS CHAPTER 2 1. Does the story about Apple's production of the ipod on page 52 in the textbook imply that people must cooperate with one another in order for specialization in production and trade to occur? Explain. 2. Comment briefly on the following statement: "The circular-flow diagram implies that the income household members receive is directly related to the market value of the resources they own." 3. Could a production possibilities frontier ever slope upward? CHAPTER 2 Trade-offs, Comparative Advantage, and the Market System 4. Create an example showing that absolute advantage in an activity does not necessarily imply comparative advantage in an activity. 5. In the explanation of Adam Smith's argument in favor of replacing the guild system with a market system, the textbook states that "a key to understanding Smith's argument is the assumption that individuals usually act in a rational, self-interested way." Did Smith believe that the success of a market system requires that people act selfishly