Suppose you and a friend are stranded on an island and must gather firewood and catch fish to survive. Through experience, you know that if each of you spends an entir day on either activity, the result is given in the following table: You Your Friend Fish 7 8 fish. You and your friend decide that you should each specialize so that one person catches fish while the other gathers firewood. But who should do which task? a. What is the opportunity cost for you to gather an additional bundle of firewood? The opportunity cost for you to gather an additional bundle of firewood is fish. (Round your answer to two decimal places.) What is your friend's opportunity cost of gathering an extra bundle of firewood? Firewood 6 bundles 3 bundles Your friend's opportunity cost of gathering an extra bundle of firewood is (Round your answer to two decimal places.) b. Assuming that you and your friend specialize, what allocation of tasks maximizes total output for your one day of joint effort? To maximize total output for your one day of joint effort, you should and your friend should c. Suppose you both decide to work for two days according to the allocation in part (b). What is the total amount of output? The total amount of output is fish and bundles of firewood. (Round your answers to the nearest whole number.) What would it have been had you the reverse allocation of tasks? Had you chosen the reverse allocation of tasks, the total amount of output would have been (Round your answers to the nearest whole number.) fish and bundles of firewood.
Suppose you and a friend are stranded on an island and must gather firewood and catch fish to survive. Through experience, you know that if each of you spends an entir day on either activity, the result is given in the following table: You Your Friend Fish 7 8 fish. You and your friend decide that you should each specialize so that one person catches fish while the other gathers firewood. But who should do which task? a. What is the opportunity cost for you to gather an additional bundle of firewood? The opportunity cost for you to gather an additional bundle of firewood is fish. (Round your answer to two decimal places.) What is your friend's opportunity cost of gathering an extra bundle of firewood? Firewood 6 bundles 3 bundles Your friend's opportunity cost of gathering an extra bundle of firewood is (Round your answer to two decimal places.) b. Assuming that you and your friend specialize, what allocation of tasks maximizes total output for your one day of joint effort? To maximize total output for your one day of joint effort, you should and your friend should c. Suppose you both decide to work for two days according to the allocation in part (b). What is the total amount of output? The total amount of output is fish and bundles of firewood. (Round your answers to the nearest whole number.) What would it have been had you the reverse allocation of tasks? Had you chosen the reverse allocation of tasks, the total amount of output would have been (Round your answers to the nearest whole number.) fish and bundles of firewood.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:Suppose you and a friend are stranded on an island and must gather firewood and catch fish to survive. Through experience, you know that if each of you spends an entire
day on either activity, the result is given in the following table:
You
Your Friend
Fish
7
8
Firewood
6 bundles
3 bundles
You and your friend decide that you should each specialize so that one person catches fish while the other gathers firewood. But who should do which task?
a. What is the opportunity cost for you to gather an additional bundle of firewood?
fish.
The opportunity cost for you to gather an additional bundle of firewood is
(Round your answer to two decimal places.)
What is your friend's opportunity cost of gathering an extra bundle of firewood?
Your friend's opportunity cost of gathering an extra bundle of firewood is fish.
(Round your answer to two decimal places.)
b. Assuming that you and your friend specialize, what allocation of tasks maximizes total output for your one day of joint effort?
To maximize total output for your one day of joint effort, you should
and your friend should
c. Suppose you both decide to work for two days according to the allocation in part (b). What is the total amount of output?
The total amount of output is fish and bundles of firewood.
(Round your answers to the nearest whole number.)
What would it have been had you the reverse allocation of tasks?
Had you chosen the reverse allocation of tasks, the total amount of output would have been fish and bundles of firewood.
(Round your answers to the nearest whole number.)
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