3. Opportunity Cost Caroline and Frances are roommates. They spend most of their time studying (of course), but they leave some time for their favorite activities: making pizza and brewing root beer. Caroline takes 3 hours to brew a gallon of root beer and 2 hours to make a pizza. Frances takes 7 hours to brew a gallon of root beer and 5 hours to make a pizza. Caroline's opportunity cost of making a pizza is is of root beer. of root beer, and Frances's opportunity cost of making a pizza has an absolute advantage in making pizza, and If Caroline and Frances trade foods with each other, has a comparative advantage in making pizza. will trade pizza in exchange for root beer. The price of pizza can be expressed in terms of gallons of root beer. The highest price at which pizza can be traded that would make both roommates better off is of root beer, and the lowest price that makes both roommates better off is of root beer per pizza.