Kayla can cook dinner in 30 minutes andwash the laundry in 20 minutes. Herroommate takes twice as long to do eachtask. How should the roommates allocatethe work?a. There are no gains from trade in thissituation.b. Kayla should do more of the washingbased on her absolute advantage.c. Kayla should do more of the washingbased on her comparative advantage.d. Kayla should do more of the cookingbased on her comparative advantage.Kayla can cook dinner in 30 minutes and wash the laundry in 20 minutes. Her roommate takes twice aslong to do each task. How should the roommates allocate the work?Oa. There are no gains from trade in this situation.O b. Kayla should do more of the washing based on her absolute advantage.Oc. Kayla should do more of the washing based on her comparative advantage.O d. Kayla should do more of the cooking based on her comparative advantage

First, let's identify the tasks and the time taken by each individual to complete them. Kayla can…

Answered: Kayla can cook dinner in 30 minutes and…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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When a country has a comparative advantage in the production of a god, t means that it can produce this good at a lomer opportunity cost than its trading partner. Then the country will specialize in the production of this good and trade it for other goods. The following graphs show the production possibilities frontiers (PPFs) for Maldonia and Desania. Both countries produce lemons and tea, each intialy (i.e, befare spedialization and trade) producing 24 million pounds of lemons and 12 milion pounds of tea, as indicated by the grey stars marked with the letter A. Maldonia Desonia 40 24 PPF 2 41 s LEMONS (Miliona of pounda) 16 34 2 4 16 34 LEMONS (Mona of pounda) Maldonia has a comparative advantage in the production of . while Desonia has a comparative advantape in the ▼ . Suppose that Maidonia and Desonia specialize in the production of the goods in which each has a comparative advantage. Alter specialization, the two countries can produce a total of 45 milion pounds of tea and48…
u work for a marketing firm that has just landed a contract with Run-of-the-Mills to help them promote three of their products: splishy splashies, flopsicles, and mookies. All of these products have been on the market for some time, but, to entice better sales, Run-of-the-Mills wants to try a new advertisement that will market two of the products that consumers will likely consume together. As a former economics student, you know that complements are typically consumed together while substitutes can take the place of other goods. Run-of-the-Mills provides your marketing firm with the following data: When the price of splishy splashies increases by 4%, the quantity of flopsicles sold increases by 1% and the quantity of mookies sold decreases by 5%. Your job is to use the cross-price elasticity between splishy splashies and the other goods to determine which goods your marketing firm should advertise together. Complete the first column of the following table by computing the…
Mark can cook dinner in 30 minutes and wash thelaundry in 20 minutes. His roommate takes half aslong to do each task. How should the roommatesallocate the work?a. Mark should do more of the cooking based on hiscomparative advantage.b. Mark should do more of the washing based on hiscomparative advantage.c. Mark should do more of the washing based on hisabsolute advantage.d. There are no gains from trade in this situation.
Suppose Amber and Jade can spend their days making croissants or writing poems. Their output per hour at each activity is the following: Croissants Poems Amber 40 2 Jade 30 1/2 In this situation, can mutually beneficial trade occur? Select one: A. No, because Jade is more productive than Amber at both activities. B. Yes, if Amber specializes in making croissants and trades them to Jade for her poems. C. No, because Amber more productive than Jade at both activities. D. Yes, if Amber specializes in writing poems and trades them to Jade for her croissants.
The New York Times (Nov. 30, 1993) reported that “the inability of OPEC to agree last week to cut production has sent the oil market into turmoil . . . [leading to] the lowest price for domestic crude oil since June 1990.” Statements True False The members of OPEC were trying to agree to cut production so they could save more oil for the future. OPEC was unable to agree on cutting production because each country has an incentive to cheat on any agreement. The newspaper also noted OPEC's view “that producing nations outside the organization, like Norway and Britain, should do their share and cut production.” What does the phrase “do their share” suggest about OPEC's desired relationship with Norway and Britain? OPEC would like Norway and Britain to act competitively. OPEC would like Norway and Britain to keep their production levels high. OPEC would like Norway and Britain to join the cartel.
. Diego and Darnell are roommates. They spend mostof their time studying (of course), but they leavesome time for their favorite activities: making pizzaand brewing root beer. Diego takes 4 hours to brewa gallon of root beer and 2 hours to make a pizza.Darnell takes 6 hours to brew a gallon of root beerand 4 hours to make a pizza.a. What is each roommate’s opportunity cost ofmaking a pizza? Who has the absolute advantagein making pizza? Who has the comparativeadvantage in making pizza?b. If Diego and Darnell trade foods with each other,who will trade away pizza in exchange for rootbeer?c. The price of pizza can be expressed in terms ofgallons of root beer. What is the highest price atwhich pizza can be traded that would make bothroommates better off? What is the lowest price?Explain.
Steel (millions of tons) 8 30 20- 10 0 Country A Production possibilition curve 10 20 30 40 Chemicals (millions of tons) From the diagrams, it can be seen that 50 Steel (millions of tons) 8 20 10 0 Country B Production possibilities curve 10 20 30 40 Chemicals (millions of tons) O the slopes of the two curves indicate both countries will specialize in chemicals. O country B has an absolute advantage in both commodities. O it is more costly in terms of resources to produce steel in country A. O country B has a comparative advantage in chemicals. O country A has a comparative advantage in both commodities. 50
Jake and Jill spend their time picking apples and strawberries. The quantities they can pick in an hour are shown in the table below. Quantity Picked in One Hour Pounds of Apples Pounds of Strawberries Jake 8 4 Jill 10 10 Suppose Jake specializes in picking apples, and Jill specializes in picking strawberries. If Jake and Jill then trade 3 apples for 2 strawberries, Jake will end up consuming Suppose Jake specializes in picking apples, and Jill specializes in picking strawberries. If Jake and Jill work for one hour, then trade 3 apples for 2 strawberries, Jake will end up consuming apples and strawberries.
define the terms of trade?what is principle of comparetive advantage
Glacier has a comparative advantage in the production of a comparative advantage in the production of Congaree specialize in the production of the goods in which each After specialization, the two countries can produce a total of and million pounds of basil. Suppose that Glacier and Congaree agree to trade. Each country focuses its resources on producing only the good in which it has a comparative advantage. The countries decide to exchange 16 million pounds of corn for 16 million pounds of basil. This ratio of goods is known as the price of trade between Glacier and Congaree. The following graph shows the same PPF for Glacier as before, as well as its initial consumption at point A. Place a black point (plus symbol) on the graph to indicate Glacier's consumption after trade. Note: Dashed drop lines will automatically extend to both axes. BASIL (Millions of pounds) 64 56 BASIL (Millions of pounds) 48 40 32 24 16 8 0 64 56 40 0 48 PPF 24 8 PPF 0 8 0 16 The following graph shows the same…
PA no Page 5 8. Pat and Kerry are considering a partnership. With all Pat's resources, Pat can produce 50 X or 20 Y. With all of Kerry's resources, Kerry can produce 30 X or 30 Y. Assume the resources can be easily substituted to make either product. They are starting by using half of the resources to make each item. These relationships are shown in the following table. Use this information to answer the following questions: Kerry Product X (Xylophones) Product Y (Yams) 50 0 Pat 25 Pat make? 10 0 20 Pat make? 30 0 15 15 0 30 a. Who has an absolute advantage in producing X? Pat b. Who is a comparative advantage in producing Y? Partnership be gained from before they started trading? c. If Pat and Kerry decided to take all the gains from trade in X, how much X would 40 25 d. If Pat and Kerry decided to take all the gains from trade in X, how much X would Gain be gained from before they started trading? e. If Pat and Kerry decided to take all the gains from trade in Y, how much Y would f.…
Debra can make either 12 cakes or 16 cookies in 4 hours. Sam can make either 6 cakes or 12 cookies in 4 hours.c. If both Debra and Sam concentrate on producing only the product in which they havea comparative advantage, how many cakes and how many cookies will they produce?

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