3. Suppose that you and your roommate Pat are planning a Valentine’s Day party at your apartment. Before you have the party you have to clean your apartment and earn $100 for food and drinks. Suppose that, working alone, either you or Pat could clean the apartment in two days. Working together you could both clean the apartment in one day. You can make $25 a day working at the dining hall, and Pat can make $50 a day as a video game instructor. According to the principle of comparative advantage, what is the most efficient way of throwing the party? Explain. How could you make an arrangement that benefits both of you?

3. Suppose that you and your roommate Pat are planning a Valentine’s Day party at your apartment. Before you have the party you have to clean your apartment and earn $100 for food and drinks. Suppose that, working alone, either you or Pat could clean the apartment in two days. Working together you could both clean the apartment in one day. You can make $25 a day working at the dining hall, and Pat can make $50 a day as a video game instructor. According to the principle of comparative advantage, what is the most efficient way of throwing the party? Explain. How could you make an arrangement that benefits both of you?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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