BuyFind

Brief Principles of Macroeconomics...

8th Edition
N. Gregory Mankiw
Publisher: Cengage Learning
ISBN: 9781337091985
BuyFind

Brief Principles of Macroeconomics...

8th Edition
N. Gregory Mankiw
Publisher: Cengage Learning
ISBN: 9781337091985

Solutions

Chapter
Section
Chapter 3, Problem 1CQQ
Textbook Problem

In an hour, Mateo can wash 2 cars or mow 1 lawn, and Tyler can wash 3 cars or mow 1 lawn. Who has the absolute advantage in car washing, and who has the absolute advantage in lawn mowing?

a. Mateo in washing, Tyler in mowing.

b. Tyler in washing, Mateo in mowing.

c. Mateo in washing, neither in mowing.

d. Tyler in washing, neither in mowing.

Expert Solution
To determine

The absolute advantage.

Answer to Problem 1CQQ

Option ‘d’ is the correct answer.

Explanation of Solution

Option (d)

Tyler has the absolute advantage in washing, since he can wash 3 cars per hour, while Mateo can only wash 2 cars per hour. None has the absolute advantage in mowing as both can only mow 1 lawn in an hour’s time. So option ‘d’ is correct.

Option (a)

Mateo can only wash 2 cars per hours, whereas Tyler can wash 3 cars in the same amount of time. So Mateo does not have the absolute advantage in washing cars. Also, both do not have the advantage over the other in mowing the lawn. So option ‘a’ is incorrect.

Option (b)

Tyler has an absolute advantage in washing, since he can wash 3 cars per hour, while Mateo can only wash 2 cars per hour but both do not have the advantage over the other in mowing the lawn. So option ‘b’ is incorrect.

Option (c)

None has the absolute advantage in mowing as both can only mow 1 lawn in an hour’s time but Tyler has the absolute advantage in washing, since he can wash 3 cars per hour, while Mateo can only wash 2 cars per hour.  So option ‘c’ is incorrect.

Economics Concept Introduction

Concept Introduction:

Absolute advantage: It is the ability to produce a good using fewer inputs than another producer does.

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