Principles Of Microeconomics
7th Edition
ISBN: 9781260111088
Author: Robert H. Frank, Ben Bernanke, Kate Antonovics, Ori Heffetz
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Question
Chapter 2, Problem 1P
To determine
The
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Suppose there are two bakers in town: Sarah and Amy. Sarah can bake 4 loaves of bread or 8 pies in one day. Amy can bake 6 loaves
of bread or 2 pies in one day. Please do the following:
(a) Calculate the opportunity cost for both Sarah and Amy for baking pies and bread
(b) Draw both Sarah and Amy's PPF curve
(c) Who has an absolute advantage in baking bread? In baking pies?
(d) Who has a comparative advantage in baking bread? In baking pies?
(e) Determine a specific trade (i.e. give me numbers) that would make both Sarah and Amy better off.
Bob and Erik are both experienced in making pizzas and burgers. In one day, Bob can make 8 pizzas or 32 burgers. With the same effort and in the same day, Erik can make 12 pizzas or 36 burgers.
Who has the absolute advantage in making pizzas and who has the absolute advantage in making burgers?
Who has the comparative advantage in each activity? Show your derivations.
According to the principle of comparative advantage, in which activity should each
person (Bob and Erik) specialize in order to gain from trade?
Note:-
Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.
Answer completely.
You will get up vote for sure.
Ted can wax a car in 25 minutes or wash a car in 75 minutes. Ishana can wax a car in 20 minutes or wash a car in 40 minutes. What is
each person's opportunity cost of washing a car?
Instructions: Enter your responses rounded to one decimal place.
Ted's opportunity cost of washing one car is
wax jobs.
Ishana's opportunity cost of washing one car is
Who has a comparative advantage in washing cars?
wax jobs.
Chapter 2 Solutions
Principles Of Microeconomics
Knowledge Booster
Similar questions
- Given Ted can wax 4 cars per day or wash 2 cars per day and Tom can wax 3 cars per day or wash 1 car per day. What is each man’s opportunity cost of waxing a car? Who has an absolute advantage of waxing cars? Who has a comparative advantage of waxing cars?arrow_forwardJoel can prepare 8 meals or wash 24 shirts in a day, Patricia can prepare 6 meals or wash 12 shirts in a day . What is Joel's opportunity cost washing one shirt?arrow_forwardElif can produce 6 pies or 30cakes in 1 hour. Ahmet can produce 10 pies or 20 cakes in 1 hour. On the PPF lines, show what Elif produces and what Ahmet produces when they specialize. When they specialize and trade, what are the total gains from trade? If Elif and Ahmet share the total gains equally, which quantities of pies and cakes do they trade?arrow_forward
- why is it not realistic for a PPF curve to be straight?arrow_forwardWhat does a PPF show? What is a trade-off?arrow_forwardKenji and Lucia are farmers. Each one owns a 12-acre plot of land. The following table shows the amount of corn and rye each farmer can produce per year on a given acre. Each farmer chooses whether to devote all acres to producing corn or rye or to produce corn on some of the land and rye on the rest. Kenji Lucia 120 On the following graph, use the blue line (circle symbol) to plot Kenji's production possibilities curve (PPF), and use the purple line (diamond symbol) to plot Lucia's PPF. 106 90 72 සිය 40 30 24 12 0 Corn (Bushels per acre) 12 15 0 Rye (Bushels per acre) 3 5 00 120 180 240 300 350 420 480 540 600 CORN (Bushels) -o Kenji's PPF Lucia's PPF (?) has an absolute advantage in the production of corn, and has an absolute advantage in the production of rye. bushels of corn, whereas Lucia's opportunity cost of producing 1 bushel of rye is opportunity cost of producing rye than Lucia, has a comparative advantage in the has a comparative advantage in the production of corn. Kenji's…arrow_forward
- Carmen and Dennis live on a desolate island. They spend their days fishing or climbing trees to collect coconuts. The following table shows how much of each activity Carmen and Dennis can produce for each hour of work. They each can work up to 12 hours a day. Fish per hour Coconuts per hour Carmen 40 8 Dennis 28 7 On a piece of paper, draw Carmen's PPF with fish on the horizontal (x) axis and coconuts on the vertical (y) axis. Carment's PPF extends from Question Blank 1 of 9 to Question Blank 2 of 9. (Hint: your answer should be in the form of a point (x,y).) Question Blank 3 of 9 has an absolute advantage in the production of fish, and Question Blank 4 of 9 has an absolute advantage in the production of coconuts. Carmen's opportunity cost of producing 1 coconut is Question Blank 5 of 9 fish, while Dennis' opportunity cost of producing 1 coconut is Question Blank 6 of 9 fish. Because Carmen has a Question Blank 7 of 9 opportunity cost of producing…arrow_forwardPut ECG Machines on the vertical axis and Defibrillators on the horizontal axis. Draw the production possibilities curve for Plant R. On a separate graph, draw the production possibilities curve for Plant S. Which plant has a comparative advantage in ECG Machines? In Defibrillators? Now draw the combined curves for the two plants. Suppose the firm decides to produce 100 Defibrillators. Where will it produce them? How many ECG Machines will it be able to produce? Where will it produce the ECG Machines?arrow_forwardSusan can pick 4 pounds of coffee in an hour or gather 2 pounds of nuts. Tom can pick 2 pounds of coffee in an hour or gather 4 pounds of nuts. Each works 6 hours per day. a. What is the maximum number of pounds of coffee the two can pick in a day? pounds. b. What is the maximum number of pounds of nuts the two can gather in a day? c. Suppose Susan and Tom were picking the maximum number of pounds of coffee when they decided that they would like to begin gathering 4 pounds of nuts per day. Who would gather the nuts? (Click to select) +. How many pounds of coffee would they still be able to pick? pounds of coffee per day. d. Now suppose Susan and Tom were gathering the maximum number of pounds of nuts when they decided that they would like to begin picking 8 pounds of coffee per day. Who would pick the coffee? (Click to select)). How many pounds of nuts would they still be able to gather? pounds of nuts per day. e. Would it be possible for Susan and Tom in total to gather 26 pounds of…arrow_forward
- Suppose you are a farmer with 20 hectares of land on which you could grow either wheat or barley. You can allocate however much land you want to each crop. Draw a Production Possibilities Frontier depicting this situation. Explain what a Production Possibilities Frontier is and what the diagram represents, including what points on, below and above the PPF represent. Explain why the PPF that you have drawn has the shape that it does. Is it possible to use just the PPF to find the best allocation for the crops? Explain.arrow_forwardSuppose France produces two types of goods: wheat and cars. The following diagram shows its current production possibilities frontier (also known as the production possibilities curve) for wheat and cars. Drag the production possibilities frontier (PPF) on the graph to show the effects of a long drought that reduces the amount of water available for farmers to use for irrigation. Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther.arrow_forwardDiego and Kris are roommates. They spend most of their time studying, but they leave some time for their favorite activities: making pizza and brewing root beer. Diego takes 4 hours to brew a gallon of root beer and 2 hours to make a pizza. Kris takes 6 hours to brew a gallon of root beer and 4hours to make a pizza. a) What is each roommate's opportunity cost of making a pizza? Who has the absolute advantage in making pizza? Who has the comparative advantage in making pizza? b) If Diego and Kris trade foods with each other, who will trade away pizza in exchange for root beer? c) The price of pizza can be expressed in terms of gallons of root beer, what is the highest price at which pizza can be traded that would make both roommates better off? What is the lowest price? Why?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
