hich of the following statements is true?

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Bassoon
60
50
40
30
20
10
0.
0 10 20 30 40 50
Total
Clarinet
Greg's PPF
Wirt's PPF
Greg and Wirt make musical instruments. The graph above shows their individual Production Possibility Frontiers (PPFs).
Greg's PPF is the green, solid line. Wirt's PPF is the orange, dotted line.
Which of the following statements is true?
a. Greg has the absolute advantage in making both instruments.
b. Writ has the absolute advantage in making both instruments.
c. They both have the absolute advantage in both instruments.
d. Writ has the absolute advantage in making clarinets while Greg has the absolute advantage in making bassoons.
e. Writ has the absolute advantage in making bassoons while Greg has the absolute advantage in making clarinets.
Transcribed Image Text:Total Bassoon 60 50 40 30 20 10 0. 0 10 20 30 40 50 Total Clarinet Greg's PPF Wirt's PPF Greg and Wirt make musical instruments. The graph above shows their individual Production Possibility Frontiers (PPFs). Greg's PPF is the green, solid line. Wirt's PPF is the orange, dotted line. Which of the following statements is true? a. Greg has the absolute advantage in making both instruments. b. Writ has the absolute advantage in making both instruments. c. They both have the absolute advantage in both instruments. d. Writ has the absolute advantage in making clarinets while Greg has the absolute advantage in making bassoons. e. Writ has the absolute advantage in making bassoons while Greg has the absolute advantage in making clarinets.
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