2. Comparative and absolute advantage

Kevin and Maria are farmers. Each one owns a 12-acre plot of land. The following table shows the amount of rye and corn each farmer can produce per year on a given acre. Each farmer chooses whether to devote all acres to producing rye or corn or to produce rye on some of the land and corn on the rest.

	Rye	Corn
(Bushels per acre)	(Bushels per acre)
Kevin	12	6
Maria	15	5

On the following graph, use the blue line (circle symbol) to plot Kevin's production possibilities frontier (PPF), and use the purple line (diamond symbol) to plot Maria's PPF.

Kevin's PPFMaria's PPF06012018024030036042048054060012010896847260483624120CORN (Bushels)RYE (Bushels)180, 0Y-Intercept: 72.00X-Intercept: 144Slope: -0.50

has an absolute advantage in the production of rye, and has an absolute advantage in the production of corn.

Kevin's opportunity cost of producing 1 bushel of corn is

bushels of rye, whereas Maria's opportunity cost of producing 1 bushel of corn is

bushels of rye. Because Kevin has a opportunity cost of producing corn than Maria, has a comparative advantage in the production of corn, and has a comparative advantage in the production of rye.