Tina can allocate her 8-hour day between baking and cooking. Each hour devoted to baking yields 2 cakes whereas each hour spent cooking produces 4 plates of food. Tina's neighbor, Ingrid, can produce 3 cakes or 4 plates of food per hour. Who has the absolute advantage in the production of cakes? Who has absolute advantage in the production of food? Who has a comparative advantage in the production of cakes? Who has a comparative advantage in the production of food? What is the opportunity cost for food?
Tina can allocate her 8-hour day between baking and cooking. Each hour devoted to baking yields 2 cakes whereas each hour spent cooking produces 4 plates of food. Tina's neighbor, Ingrid, can produce 3 cakes or 4 plates of food per hour. Who has the absolute advantage in the production of cakes? Who has absolute advantage in the production of food? Who has a comparative advantage in the production of cakes? Who has a comparative advantage in the production of food? What is the opportunity cost for food?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Tina can allocate her 8-hour day between baking and cooking. Each hour devoted to baking yields 2 cakes whereas each hour spent cooking produces 4 plates of food. Tina's neighbor, Ingrid, can produce 3 cakes or 4 plates of food per hour.
Who has the
Who has absolute advantage in the production of food?
Who has a
Who has a comparative advantage in the production of food?
What is the
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