Darryl Can Build Picnic Tables Twice as Fast as Trevon

question 147

Multiple Choice

Darryl can build picnic tables twice as fast as Trevon. Darryl can assemble swing sets three times as fast as Trevon. The law of comparative advantage suggests that

• A) Darryl can gain only at Trevon's expense.
• B) Trevon can gain only at Darryl's expense.
• C) both can gain if Darryl specializes in assembling swing sets and Trevon in building picnic tables.
• D) both can gain if Darryl specializes in building picnic tables and Trevon in assembling swing sets.

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Definitions:

Fair Market Value

The estimated price at which an asset would change hands between a willing buyer and a willing seller, with both parties having reasonable knowledge of all relevant facts and neither being compelled to buy or sell.

Accounts Payable

Accounts payable are liabilities or money owed by a company to its creditors for goods and services received.

Uniform Partnership Act

Laws enacted in most states that govern how a partnership is formed, operated, and liquidated.

John Partner's, Capital

Represents the account on a balance sheet indicating the value of an owner's (John Partner, in this case) interest in the business.