EBK PRINCIPLES OF MACROECONOMICS
EBK PRINCIPLES OF MACROECONOMICS
8th Edition
ISBN: 8220103611855
Author: Mankiw
Publisher: Cengage Learning US
Question
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Chapter 3, Problem 1CQQ
To determine

The absolute advantage.

Expert Solution & Answer
Check Mark

Answer to Problem 1CQQ

Option ‘d’ is the correct answer.

Explanation of Solution

Option (d)

Tyler has the absolute advantage in washing, since he can wash 3 cars per hour, while Mateo can only wash 2 cars per hour. None has the absolute advantage in mowing as both can only mow 1 lawn in an hour’s time. So option ‘d’ is correct.

Option (a)

Mateo can only wash 2 cars per hours, whereas Tyler can wash 3 cars in the same amount of time. So Mateo does not have the absolute advantage in washing cars. Also, both do not have the advantage over the other in mowing the lawn. So option ‘a’ is incorrect.

Option (b)

Tyler has an absolute advantage in washing, since he can wash 3 cars per hour, while Mateo can only wash 2 cars per hour but both do not have the advantage over the other in mowing the lawn. So option ‘b’ is incorrect.

Option (c)

None has the absolute advantage in mowing as both can only mow 1 lawn in an hour’s time but Tyler has the absolute advantage in washing, since he can wash 3 cars per hour, while Mateo can only wash 2 cars per hour.  So option ‘c’ is incorrect.

Economics Concept Introduction

Concept Introduction:

Absolute advantage: It is the ability to produce a good using fewer inputs than another producer does.

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