Question
In your res Opportunity costs and comparative advantage are both important when making business decisions, especially when mixed in with this exercise of trading. For
In your res Opportunity costs and comparative advantage are both important when making business decisions, especially when mixed in with this exercise of trading. For the trades to be worthwhile, the opportunity cost and the comparative advantage need to make sense. In this scenario, it was clear that the other truck had the comparative advantage of making hamburgers, where as I had the advantage making the fries. By being able to identify this, we each were able to focus on different items increasing our output, which now makes our PPF better since we are optimizing our production. Now, when I started the simulation without trade, I had absolute control over my output especially when most of the variable have been decided for this exercise. The best I could get for 30 minutes was 80 combos of 1 hamburger and 1 fry each. Now once I added in the second vendor truck I was able to get that food truck to make extra hamburgers while I made extra fries. My best trade number took me to around 93 combos out of my various attempts. Not every trade opportunity was good for me, and not every offer I made was accepted. When you
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