Antonio and Elyse Are Two Woodworkers Who Both Make Kitchen

question 101

Multiple Choice

Antonio and Elyse are two woodworkers who both make kitchen cabinets and bathroom vanities. In one month, Antonio can make 12 kitchen cabinets or 36 bathroom vanities, where Elyse can make 10 kitchen cabinets or 50 bathroom vanities. Who has an absolute advantage in which product?

• A) Antonio in bathroom vanities, Elyse in kitchen cabinets
• B) both Antonio and Elyse in kitchen cabinets
• C) both Antonio and Elyse in bathroom vanities
• D) Antonio in kitchen cabinets, Elyse in bathroom vanities

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Definitions:

Market Power

Refers to the ability of a firm or group of firms to manipulate the price and output levels in the market to their advantage.

Supply

The total amount of a specific good or service available to consumers at a given price level.

Input Market

The input market is the marketplace where companies or individuals procure resources, such as raw materials, labor, and services, needed to produce goods or offer services.

Demand Curve

A graph showing how the demand for a commodity or service varies with changes in its price.