With the information on top, look at question F. Tell me why Liz has comparative advantage over mike in cleaning windows when mike has comparative advantage in picking up leaves? Shouldn’t it be mike for both of them? Econ 205 Homework 2Suggested SolutionsChapters 3, 4: Trade, markets, demandanswer question 1.windows in an hour.a.. What is absolute advantage?equivalently more bags or windows per hour.Who has an absolute advantage in picking up leaves?Mikeb.Who has an absolute advantage in cleaning windows?Mikeс.d. What is comparative advantage?The ability to produce a good at a lower opportunity cost than another producer.Who has a comparative advantage in picking "p leaves?e.Mikef.Who has a comparative advantage in cleaning windows?Lizg. If they both spend half an hour bagging leaves and half an hour cleaningwindows, could they make a trade with each other and both finish in less thanan hour? Explain.Yes, Liz has a comparative advantage in windows (opp. cost = 4 bags/6 windows=.67 bags per window compared to Mike .75 bags per window) and Mike has acomparative advantage in leaves (opp. cost =1.33 window per bag compared to 1.5windows per bag for Liz). So it is possible for them to trade at between theiropportunity costs and complete the same number of windows and bags of leaves inunder an hour. For example, if Liz takes over 1.4 windows from Mike for each bagf leaves Mike takes over from Liz.

Name: With the information on top, look at question F. Tell me why Liz has c
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Description: With the information on top, look at question F. Tell me why Liz has comparative advantage over mike in cleaning windows when mike has comparative advantage in picking up leaves? Shouldn’t it be mike for both of them? Econ 205 Homework 2Suggested Sol

Comparative advantage is when an individual or a country can produce a good with lower opportunity…

Answered: Econ 205 Homework 2 Suggested Solutions…

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With the information on top, look at question F. Tell me why Liz has comparative advantage over mike in cleaning windows when mike has comparative advantage in picking up leaves? Shouldn’t it be mike for both of them?

Econ 205 Homework 2
Suggested Solutions
Chapters 3, 4: Trade, markets, demand
answer question 1.
windows in an hour.
a.. What is absolute advantage?
equivalently more bags or windows per hour.
Who has an absolute advantage in picking up leaves?
Mike
b.
Who has an absolute advantage in cleaning windows?
Mike
с.
d. What is comparative advantage?
The ability to produce a good at a lower opportunity cost than another producer.
Who has a comparative advantage in picking "p leaves?
e.
Mike
f.
Who has a comparative advantage in cleaning windows?
Liz
g. If they both spend half an hour bagging leaves and half an hour cleaning
windows, could they make a trade with each other and both finish in less than
an hour? Explain.
Yes, Liz has a comparative advantage in windows (opp. cost = 4 bags/6 windows
=.67 bags per window compared to Mike .75 bags per window) and Mike has a
comparative advantage in leaves (opp. cost =1.33 window per bag compared to 1.5
windows per bag for Liz). So it is possible for them to trade at between their
opportunity costs and complete the same number of windows and bags of leaves in
under an hour. For example, if Liz takes over 1.4 windows from Mike for each bag
f leaves Mike takes over from Liz.

Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

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