If They Bake Only Cakes,in a Single Day George Can

question 62

Multiple Choice

If they bake only cakes,in a single day George can bake 10 cakes,and Greta can bake 5 cakes.If they make only pies,in a single day George can bake 10 pies,while Greta can bake 4 pies.We know that _____ has an absolute advantage and a comparative advantage in making _____.

• A)George;cakes
• B)George;pies
• C)Greta;cakes
• D)Greta;pies

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Definitions:

Service Company

A business that provides services to consumers or other businesses rather than manufacturing goods.

Planning Budget

A budget established at the beginning of the budgeting period that is valid only for the planned level of activity.

Net Operating Income

A financial metric that calculates a company's profit after operating expenses are subtracted but before income taxes and interest are deducted.

Variable Manufacturing Overhead

Costs in manufacturing that vary with the level of production output, such as utilities or indirect material costs, but do not include direct materials or direct labor.