Absolute and Comparative Advantage

Front

The producer that can produce the most output OR requires the least amount of inputs (resources)

Back

Absolute Advantage

Front

The producer with the lowest opportunity cost.

Back

Comparative Advantage

Front

Based on the table provided, which one of the following statements is correct? Options: Japan has the absolute advantage in producing cars, Japan has the comparative advantage in producing cars, The United States has the absolute advantage in producing both cars and computers, The opportunity cost of producing a car in Japan is 1/2 a computer

Back

The opportunity cost of producing a car in Japan is 1/2 a computer

Front

Who has the absolute advantage for haircuts? Joy gives 2 haircuts and 1 perm. Susie gives 3 haircuts and 2 perms.

Back

Susie

Front

Who has the absolute advantage for vacuuming?

Back

Joe

Front

Which country has the absolute advantage in producing airplanes? The US can produce 200 airplanes or 400 trucks. Japan can produce 300 trucks or 100 airplanes.

Back

US

Front

What is the opportunity cost of producing a car in the U.S. if the U.S. can produce 50 cars and 25 tools?

Back

.5 tools

Front

From the last question, who has the absolute advantage in tools?

Back

U.S.

Front

Using the same information from the last question, who has the absolute advantage in the production of cars?

Back

U.S.

Front

Who has the comparative advantage in cars?

Back

U.S.