Loudoun County Public Schools



Comparative Advantage Worksheet: What is the difference between absolute advantage and comparative advantage? Use the charts to complete the following questions: MIKE & DEBBY MikeDebbyVacuum room60 minutes45 minutesWash Dishes30 minutes45 minutes Mike: DEBBY:1 room = 1load 1 room = 1 load1 load = 1/2 room 1 load = 1 room What is Mike’s opportunity cost of vacuuming in terms of washing dishes 2 loads of dishesWhat is Mike’s opportunity cost of washing dishes in terms of vacuuming?Vacuuming ? a roomWhat is Debbie’s opportunity cost of vacuuming in terms of washing dishes?Washing 1 load of dishesWhat is Debbie’s opportunity cost of washing dishes in terms of vacuuming?Vacuuming 1 roomWho has the absolute advantage in vacuuming?DebbieWho has the absolute advantage in washing dishes?MikeWho has the comparative advantage in vacuuming?DebbieWho has the comparative advantage in washing dishes?MikeWho should do which chore and why?Mike should wash dishes and Debbie should vacuum because they have the comparative advantage in those chores. They have the lowest opportunity cost in the chores and will be more efficient. ANDY & HANNAH AndyHannahcleaning offices60 minutes20 minutescleaning jail cells30 minutes15 minutes ANDY: HANNAH:1 office = 2 jail cells 1 office = 4/3 jail cells1 jail cell = ? office 1 jail cell = ? office What is Andy’s opportunity cost of cleaning offices in terms of cleaning jail cells?Cleaning 2 jail cellsWhat is Hannah’s opportunity cost of cleaning offices in terms of cleaning jail cells?4/3 of a jail cellWhat is Andy’s opportunity cost of cleaning jail cells in terms of cleaning offices?Cleaning ? of an officeWhat is Hannah’s opportunity cost of cleaning jail cells in terms of cleaning offices?Cleaning ? of an officeWho has the absolute advantage in cleaning offices?HannahWho has the absolute advantage in cleaning jail cells?HannahWho has the comparative advantage in cleaning offices?HannahWho has the comparative advantage in cleaning jail cells?AndyWho should do which chore and why?Hannah should clean offices and Andy should clean jail cells because they will finish their chores sooner. The person with the lowest opportunity cost should do the chore. US & JAPAN USJAPANCars1210Computers46 US: JAPAN:1 car = 1/3 computer 1 car = 3/5 computer1 computer = 3 car 1 computer = 5/3 car What is the US’s opportunity cost of making cars?For every car it must give up 1/3 of a computerWhat is Japan’s opportunity cost of making cars?For every car it must give up 3/5 of a computerWhat is US’s opportunity cost of making computers?For every computer it must give up 3 carsWhat is Japan’s opportunity cost of making computers?For every computer it must give up 5/3 of a car Who has the absolute advantage in cars?USWho has the absolute advantage in computers?JapanWho has the comparative advantage in cars?USWho has the comparative advantage in computers?JapanWhich country should produce which good and why?US should make cars and Japan should make computers because each country can produce them for the lowest cost. The total output of computers and cars would be higher. ................
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