Use the Following Scenario to Answer the Next Four Questions

question 12

Multiple Choice

Use the following scenario to answer the next four questions:
RayRay and Andrew produce baseballs and golf balls. RayRay can produce six baseballs per hour or four golf balls per hour. Andrew can produce three baseballs per hour or one golf ball per hour.
-Based on the scenario,which of the following is true?

• A) RayRay has both an absolute and a comparative advantage in baseball production.
• B) RayRay has both an absolute and a comparative advantage in golf ball production.
• C) RayRay has neither an absolute nor a comparative advantage in baseball production.
• D) RayRay has neither an absolute nor a comparative advantage in golf ball production.
• E) Andrew has both an absolute and a comparative advantage in baseball production.

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Definitions:

Scenario Analysis

A process of assessing future trends by analyzing different conceivable future scenarios, enabling decision-makers to prepare for various potential outcomes.

Future

The time or a period of time following the present moment, yet to occur or come into existence.

Scenario Analysis

A planning tool used to make flexible long-term plans that test strategies against diverse future scenarios.

Competitors

Other businesses or entities that offer similar products or services and vie for the same customer base within a market.