Suppose Cathy and Lewis Work in a Bakery Making Pies

question 39

Multiple Choice

Suppose Cathy and Lewis work in a bakery making pies and cakes. Suppose it takes Cathy 1.5 hours to make a pie and 1 hour to make a cake, and suppose it takes Lewis 2 hours to make a pie and 1.5 hours to make a cake. Which of the following statements is correct?

• A)Cathy should specialize in both pies and cakes.
• B)There are no gains from specialization and trade.
• C)Lewis should specialize in pies, and Cathy should specialize in cakes.
• D)Cathy should specialize in pies, and Lewis should specialize in cakes.

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Definitions:

Sarbanes-Oxley Act

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