Question

. As the manager at a local florist, you supervise two employees, Anita and Jerome. There are two tasks that need to be completed: floral arrangements and flower delivery. It takes Anita 30 minutes to finish one floral arrangement and it takes her 40 minutes to make one delivery. It takes Jerome 10 minutes to finish one floral arrangement and it takes him 30 minutes to make one delivery.

a. Who has an absolute advantage in each task?

b. What are Anita and Jerome’s opportunity costs of making floral arrangements? What is each of their opportunity costs of making one delivery?

c. Who has a comparative advantage in floral arrangements? What about deliveries?

d. Suppose, initially, Jerome and Anita each spent 4 hours each day doing floral arrangements and 2 hours each day doing deliveries. If you changed their tasks so that each individual did nothing but the task for which they had a comparative advantage, how many more floral arrangements would your store make, and how many more deliveries?

Answer 1

Answer:

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