Liz's opportunity cost of producing 1 short story is 1 gallon of orange juice. Thus, Liz has the comparative advantage in the production of short stories. Hugh's opportunity cost of producing 1 gallon of juice is 1/2 short story.
Which country has the comparative advantage in the production of oranges?
The United States has the comparative advantage in producing oranges. of producing one bushel of avocadoes is one-half a bushel of oranges.
Who has a comparative advantage in the production of apples?
When comparing two producers, whoever has the lower opportunity cost has the comparative advantage. Producing according to comparative advantage works for individuals, regions, and even countries. Spudville and Appletown can produce both potatoes and apples.
Which country has a comparative advantage in producing?
Again recall that comparative advantage was defined as the opportunity cost of producing goods. Since Saudi Arabia gives up the least to produce a barrel of oil, (1414 < 22 in Table 4) it has a comparative advantage in oil production.
Who has an absolute advantage in the production of oranges?
For each acre of land assigned to orange production, Mary harvests 10 oranges per year, while Orson harvests 9 oranges per year. Thus, Mary has the absolute advantage in oranges.
Who has a comparative advantage in making bracelets?
D. Haley has a comparative advantage in making bracelets and Serena in making necklaces. The table above shows the output per week of two jewelers, Serena and Haley. They can either devote their time to making bracelets or making necklaces.
Who has the comparative advantage in coffee production Julia or Oscar?
how do you find opportunity cost? whoever can produce something at the lower cost. ( i.e. if julia's opportunity cost for coffee is 2 bananas, then she has the comparative advantage over oscar . since oscar's opportunity cost for bananas is 1/4 coffee versus julia's 1/2 coffee, oscar has the comparative advantage. )
Which country has the highest opportunity cost for producing a yard of cloth?
Which country has the highest opportunity cost for producing a yard of cloth? The opportunity cost of producing a yard of cloth in England is 1/10 barrels of wine and the opportunity cost of producing a yard of cloth in Portugal is 1/2 barrels of wine.
Who has the comparative advantage in producing potatoes?
The farmer has a comparative advantage in producing potatoes, since his opportunity cost (1/4) is smaller than the rancher's opportunity cost (1/2).
What is the lowest opportunity cost of producing a particular good?
Comparative advantage is an economy's ability to produce a particular good or service at a lower opportunity cost than its trading partners. A comparative advantage gives a company the ability to sell goods and services at a lower price than its competitors and realize stronger sales margins.
Which country has a comparative advantage in the production of honey?
The United States has a comparative advantage in the production of honey and Canada has a comparative advantage in the production of maple syrup.
Which country has the absolute advantage in bananas?
Puerto Rico has the absolute advantage in bananas, while Jamaica has the absolute advantage in sugar cane.
Is it possible for a country to have a comparative advantage in producing?
A comparative advantage exists when a country can produce goods at a lower opportunity cost compared to other countries. It is not possible for a country to have a comparative advantage in all goods. ... An absolute advantage exists when a country is simply the best (most efficient) in producing a product or service.
Which country has an absolute advantage in automobile production?
The United States has the absolute advantage in the production of both cars and wine. It can produce more of both goods.
What is opportunity cost in everyday life?
In daily life, opportunity costs are the benefits or pleasures foregone by choosing one alternative over another . For instance, if you decide to spend money eating out for dinner in a restaurant, then you forgo the opportunity to eat a home-cooked meal.
What does the United States have an absolute advantage in?
The United States has an absolute advantage in productivity with regard to both shoes and refrigerators ; that is, it takes fewer workers in the United States than in Mexico to produce both a given number of shoes and a given number of refrigerators.
