Table 2.5 Table 2.5 Shows the Output Per Month of Two People

question 83

Multiple Choice

Table 2.5

Table 2.5 shows the output per month of two people, Fred and Barney. They can either devote their time to making pogo sticks or making unicycles.
-Refer to Table 2.5. Which of the following statements is true?

• A)Fred has an absolute advantage in making both products.
• B)Barney has an absolute advantage in making both products.
• C)Barney has an absolute advantage in making pogo sticks and Fred in making unicycles.
• D)Barney has an absolute advantage in making unicycles and Fred in making pogo sticks.

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Definitions:

Unilateral Mistake

An error made by one party during the formation of a contract that may affect the enforceability or terms of the agreement.

Mistake Of Fact

A misunderstanding of a fact that is material to a contract, which can render the agreement voidable if the mistake is mutual between both parties.

Legal Assent

The agreement or consent to the terms of a contract, recognizing that all parties understand and accept the conditions as legally binding.

Fraudulent Misrepresentation

A false statement of a material fact made by one party to another party, which has the intent to deceive and induce the other party to enter into a contract.