Principles of Microeconomics
7th Edition
ISBN: 9781305156050
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Chapter 3, Problem 3QR
To determine
Example for absolute and comparative advantage .
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Is it possible to have a comparative advantage in the production of a good but not to have an absolute advantage? Explain.
What does it mean to have an absolute advantage?
What does it mean to have a comparative advantage?
Give three examples of trade in servieces and explain how comparative advantage may play a role in them. Do you think there are other factors at work than comparative advantage?
Chapter 3 Solutions
Principles of Microeconomics
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- Is the following statement true or false? Please explain. "Everyone has a comparative advantage."arrow_forwardDiscuss the opportunity cost you incur for some activity in your life. Additionally, what activity do you feel you have comparative advantage in?arrow_forwardGive an example in which one person has an absoluteadvantage in doing something but another personhas a comparative advantagearrow_forward
- Do you have an absolute or comparative advantage in doing something over someone else? Explain in a paragraph of 3 to 5 sentences.arrow_forwardDefine comparative advantage with the use of opportunity cost. Give a real life example of it.arrow_forwardExplain why it is possible for a country to have an absolute advantage in all goods, and yet it is impossible for a country to have the comparative advantage in all goods?arrow_forward
- What is the difference between absolute advantage and comparative advantage in decisions to trade with another country?arrow_forwardDefine the term comparative advantage in the context of economics. Please explain in a well manner.arrow_forwardSuppose a world with two persons and two goods. Is the following statement True, False, Both (True and False), or None (neither True nor False): "Each person has a comparative advantage."arrow_forward
- Sonya takes 5 minures to iron a shirt and 10 minutes to type a paper. Grace takes 5 minutes to iron a shirt and 15 minutes to type a paper. Who has the comparative advantage in ironing? What is the opportunity cost of Sonya ironing a shirt? What is the opportunity cost of Sonya typing a paper? What is the opportunity cost of Grace ironing a shirt? What is the opportunity cost of Grace typing a paper?arrow_forwardWhat is the doctrine of comparative advantage? Provide an example of a particular country’s comparative advantage.arrow_forwardSomeone has a comparative advantage in producing a good if they can produce that good in greater quantities at a lower opportunity cost using more capital and less labor using more labor and less capitalarrow_forward
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