Michael and Angelo Are Both Artists Who Can Create Sculptures

question 42

Multiple Choice

Michael and Angelo are both artists who can create sculptures or paintings each day. The following table describes their maximum outputs per day. Use this table to answer the questions that follow.

-Does either Michael or Angelo have a comparative advantage?

• A) Yes, Michael has a comparative advantage in both sculptures and paintings.
• B) Yes, Angelo has a comparative advantage in both sculptures and paintings.
• C) Yes, Michael has a comparative advantage in paintings, and Angelo has a comparative advantage in sculptures.
• D) Yes, Michael has a comparative advantage in sculptures, and Angelo has a comparative advantage in paintings.
• E) No, neither has a comparative advantage.

---

Definitions:

Output

The aggregate production of either goods or services by an organization, commercial sector, or the economy as a whole.

Diminishing Returns Effect

A principle in economics where increasing one factor of production, while keeping others constant, will at some point yield lower per-unit returns.

Variable Cost

Expenses that vary directly with the level of production output, such as raw materials, labor, and energy costs.

Output

The total amount of goods or services produced by a company, sector, or economy within a specific time period.