Question

Who has an absolute advantage in coffee production? Who has an absolute advantage in nut production?

a. What is the opportunity cost for Jessica to produce one more pound of nuts? b. What is the opportunity cost for Jessica to produce one more pound of coffee? c. What is the opportunity cost for Buster to produce one more pound of nuts? d. What is the opportunity cost for Buster to produce one more pound of coffee? Who has a comparative advantage in nut production? Who has a comparative advantage in coffee production? Who has a comparative advantage in nut production? Who has a comparative advantage in coffee production?

Jessica and Buster both produce nuts and coffee. They each prefer to consume a diet that is half nuts and half coffee. Both have access to the sameresources. If Jessica focuses on producing only coffee, she can produce 20 pounds of coffee in a week. If she only produces nuts, she can produce 40 pounds of nuts in a week. Buster can produce a maximum of 15 pounds of coffee in a week. He could also choose to produce only nuts, in which case he can produce 20 pounds of nuts a week.

Fig: 1

Fig: 2

Fig: 3

Fig: 4

Fig: 5

Fig: 6

Fig: 7

Fig: 8

Fig: 9

Fig: 10

Fig: 11

Fig: 12