Zora can produce 4 quilts in a week and she can produce 1 corporate website in a week. Lou can produce 9 quilts in a week and he can produce 2 corporate websites in a week. Zora has the comparative advantage in quilts and the absolute advantage in neither good, while Lou has the comparative advantage in corporate websites and the absolute advantage in both goods.

True / False.

Question

Lilah Solomon

Social Studies

4 September, 07:53

Zora can produce 4 quilts in a week and she can produce 1 corporate website in a week. Lou can produce 9 quilts in a week and he can produce 2 corporate websites in a week. Zora has the comparative advantage in quilts and the absolute advantage in neither good, while Lou has the comparative advantage in corporate websites and the absolute advantage in both goods.

True / False.

+2

Answers (1)

Know the Answer?

Anthony Olson · Answer 1

False

Explanation:

Lou also has an advantage producing quilts, he produces almost double the quilts Zora produces, having that in mind, it is only logical that Zora can not have the comparative advantage over Lou regarding the produced quilts, therefore, Lou indeed has the absolute advantage in both goods.