Comparative and absolute advantage

Felix and Janet are farmers. Each one owns a 20-acre plot of land. The following table shows the amount of corn and rye each farmer can produce per year on a given acre.

Suppose that France and Austria consider trading olives and fish with each other

Suppose that France and Austria both produce fish and olives. France’s opportunity cost of producing a crate of olives is 4 pounds of fish while Austria’s opportunity cost of producing a crate of olives is 10 pounds of fish. By comparing the opportunity cost of producing olives in the two countries, you can tell that… Continue reading Suppose that France and Austria consider trading olives and fish with each other

2-2 Simulation Discussion: Comparative Advantage

In your responses, comment on the posts of at least two peers whose simulations had different outcomes than your own. Research and provide examples of companies in the news that are relevant to your peers’ comments on the value of comparative advantage for making their business decisions.

Complete the following table by computing the opportunity cost of Juanita’s time and the total cost of shopping at each location.

Juanita is deciding whether to buy a suit that she wants, as well as where to buy it. Three stores carry the same suit, but it is more convenient for Juanita to get to some stores than others. For example, she can go to her local store, located 15 minutes away from where she works,… Continue reading Complete the following table by computing the opportunity cost of Juanita’s time and the total cost of shopping at each location.