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  3. 2 comparative and absolute advantage sam and teresa are farmers...

Question: 2 comparative and absolute advantage sam and teresa are farmers...

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2. Comparative and absolute advantage Sam and Teresa are farmers. Each one owns a 12-acre plot of land. The following table shows the amount of alfalfa and barley each farmer can produce per year on a given acre. Each farmer chooses whether to devote all acres to producing alfalfa or barley or to produce alfalfa on some of the land and barley on the rest. Barley Alfalfa (Bushels per acre) 12 15 (Bushels per acre) Sam Teresa On the following graph, use the blue line (circle symbol) to plot Sams production possibilities frontier (PPF), and use the purple line (diamond symbol) to plot Teresas PPF120 T 108 Sams PPF 95 84 Teresas PPF CC 48 35 24 12 0 60 20 180 240 300 380 420 480 540 600 ALFALFA (Bushels)has an absolute advantage in the production of alfalfa, and has an absolute advantage in the production of barley, Sams opportunity cost of producing 1 bushel of barley is barley is comparative advantage in the production of barley, andhas a comparative advantage in the production of alfalfa. bushels of alfalfa, whereas Teresas opportunity cost of producing 1 bushel of bushels of alfalfa. Because Sam has a opportunity cost of producing barley than Teresa, has a

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