The Figures Below Depict the Production Possibilities Frontiers (PPFs) for Two

question 14

Multiple Choice

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the next two questions.

-Which statement best describes the absolute advantage as shown in the graphs?

• A) Pam has an absolute advantage in the production of both.
• B) Jim has an absolute advantage in the production of both.
• C) Jim has an absolute advantage in the production of pizzas, and Pam has an absolute advantage in the production of stromboli.
• D) Pam has an absolute advantage in the production of pizzas, and Jim has an absolute advantage in the production of stromboli.
• E) They both have an absolute advantage in the production of stromboli.

---

Definitions:

Monopoly Power

Refers to the capacity of a single firm or entity to control a majority share of a market, thus influencing prices and production levels without significant competition.

Natural Monopoly

An industry in which a single firm can provide cheaper service than could several competing firms.

Local Electric

Refers to the provision and consumption of electricity in a specific geographical area, often managed by a local utility company.

Cable TV

A system of delivering television programming via coaxial cables to subscribers, offering a variety of channels and services.