1. Business
  2. Economics
  3. 3 problems and applications 93 simone and ana are roommates...

Question: 3 problems and applications 93 simone and ana are roommates...

Question details

3. Problems and Applications 93 Simone and Ana are roommates. They spend most of their time studying (of course), but they leave some time for their favorite activities: making pizza and brewing root beer. Simone takes 4 hours to brew a gallon of root beer and 2 hours to make a pizza. Ana takes 6 hours to brew a gallion of root beer and 4 hours to make a pizza Simones opportunity cost of making a pizza is is of root beer, and Anas opportunity cost of making a pizza 7 of root beer has an absolute advantage in making pizza, and has a comparative advantage in making pizza. Ir Simone and Ana trade foods with each othewill trade away pizza in exchange for root beer The price of pizza can be expressed in terms of gallons of root beer. The highest price at which pizza can be traded that would make both roommates better off is root beer per pizza of root beer, and the lowest price that makes both roommates better off is
Solution by an expert tutor
Blurred Solution
This question has been solved
Subscribe to see this solution