Question

Graded Attempts: Score: /4 3. Problems and Applications Q3 Kyoko and Rina are roommates. They spend most of their time studying (of course), but they leave some time for their favorite activities: making pizza and brewing root beer. Kyoko takes 3 hours to brew a gallon of root beer and 2 hours to make a pizza. Rina takes 7 hours to brew a gallon of root beer and 5 hours to make a pizza. Kyoko's opportunity cost of makinht pizza is of root beer, and Rina's opportunity cost of making a pizza is Y of root beer. 2/3 gallon has a comparative advantage in making pizza Vaonh 1 1/2 gallons has an absolute advantage in ma s/7 gallon If Kyoko and Rina trade foods wit h each othel trade away pizza in exchange for root beer 1 2/5 gallons The price of pizza can be expressed in terms of gallons of root beer. The highest price at which pizza can be traded both roommates better off is that would make of root beer, and the lowest price that makes both roommates better off is y of root beer per pizza Contnue without saving

Answer 1

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