Completed Per Day

Flower Beds Weeded

Bags of Leaves Raked

Samantha

4

8

Adam

5

25

Samantha and Adam own a gardening business together. They each pull weeds from flower beds and rake up leaves for their neighbors. If each decides to specialize in what they are best at, Samantha will

a. weed and Adam will rake because these are the goods each has a comparative advantage in.

b. rake and Adam will weed because these are the goods each has a comparative advantage in.

c. weed and Adam will rake because these are the goods each has an absolute advantage in.

d. rake and Adam will weed because these are the goods each has an absolute advantage in.

The correct option is A, Samantha weed and Adam will rake because these are the goods each has a comparative advantage in.

Explanation:

The opportunity formula comes handy in this case, which is given below:

opportunity cost formula=what one sacrifices/what one gains

If Samantha were to weed flower beds, opportunity cost is computed thus:

Opportunity cost of Samantha weeding flower beds=8/4 = 2 bags of leaves raked

The opportunity of Adam weeding flower beds=25/5 = 5 bags of leaves raked.

In a nutshell, if Samantha weeds flowers they would lose 2 bags of leaves raked while if Adam were to do so same, they would lose 5 bags of leaves raked, conclusively Samantha should weed flower beds since she has lower opportunity, higher comparative advantage