If Jeremy Has an Absolute Advantage in Cooking and Margaret

question 53

Multiple Choice

If Jeremy has an absolute advantage in cooking and Margaret has an absolute advantage in cleaning,then:

• A)Jeremy has a comparative advantage in cooking and Margaret has a comparative advantage in cleaning.
• B)Jeremy has a comparative advantage in cleaning and Margaret has a comparative advantage in cooking.
• C)Margaret has a comparative advantage in cleaning,but we can conclude nothing about Jeremy.
• D)Jeremy has a comparative advantage in cooking,but we can conclude nothing about Margaret.
• E)we can conclude nothing about comparative advantage.

---

Definitions:

Average Total Cost

Average total cost is the total cost of production divided by the total quantity produced, representing the cost per unit of output.

Economic Profits

The difference between a firm's total revenues and its total costs, including both explicit and implicit costs, indicating surplus beyond the normal profit level.

Demand Curves

Graphical representations that show the relationship between the price of a good or service and the quantity demanded by consumers.

Industry Entry

The process by which new competitors join an industry, often bringing innovation or increased competition.