Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Loc and Ashima are farmers. Each one owns a 16-acre plot of land. The following table shows the amount of zucchini and watermelon each farmer

Loc and Ashima are farmers. Each one owns a 16-acre plot of land. The following table shows the amount of zucchini and watermelon each farmer can produce per year on a given acre. Each farmer chooses whether to devote all acres to producing zucchini or watermelon or to produce zucchini on some of the land and watermelon on the rest.

Zucchini Watermelon
(Pounds per acre) (Pounds per acre)
Loc 6 6
Ashima 20 5

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

Loc's PPFAshima's PPF0801602403204004805606407208001601441281129680644832160WATERMELON (Pounds)ZUCCHINI (Pounds)

has an absolute advantage in the production of zucchini, and has an absolute advantage in the production of watermelon.

Loc's opportunity cost of producing 1 pound of watermelon is

pounds of zucchini, whereas Ashima's opportunity cost of producing 1 pound of watermelon is

pounds of zucchini. Because Loc has a opportunity cost of producing watermelon than Ashima, has a comparative advantage in the production of watermelon, and has a comparative advantage in the production of zucchini.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction to Global Business Understanding the International Environment & Global Business Functi

Authors: Julian Gaspar, James Kolari, Richard Hise, Leonard Bierman, L. Smith, Antonio Arreola Risa

2nd edition

1305501187, 9780547152127, 547152124, 9781111824259, 1111824258, 978-1305501188

More Books

Students also viewed these Economics questions

Question

=+b) Are the conditions for ANOVA met? Why or why not?

Answered: 1 week ago