Katie and Hugh Are Producing Pies and Jars of Pickles

question 75

Multiple Choice

Katie and Hugh are producing pies and jars of pickles. Katie can produce either 200 jars of pickles or 100 pies per month. Hugh can produce either 800 jars of pickles or 200 pies per month. Currently, each divide their time equally between production of the two goods per month -- Katie produces 100 jars of pickles and 50 pies while Hugh produces 400 jars of pickles and 100 pies. In order for Katie and Hugh to jointly gain from specialization, which of the following changes should take place?

• A)Hugh should produce more pies and fewer jars of pickles.
• B)Katie should produce more pies and fewer jars of pickles.
• C)Katie and Hugh should both produce more pies and fewer jars of pickles.
• D)Katie and Hugh should both produce more jars of pickles and fewer pies.
• E)Katie should produce more jars of pickles and fewer pies.

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Definitions:

Stamping Machine

A machine used in the manufacturing process to imprint or shape items with specific designs or patterns.

Accrued Interest

Interest that has been incurred but not yet paid, typically referring to the interest on a bond since the last interest payment was made.

Land

A real estate property consisting of the earth's surface, along with any attached natural resources and rights.

Disposal of Asset

The process of selling, scrapping, or otherwise removing an asset from a company's balance sheet, often due to obsolescence, surplus, or a strategic shift.