Question

There are two friends, Ana and Paulo. Ana can run 3 miles in 24 minutes, and she can do 20 pushups in 40 seconds. Paulo can run 3 miles in 30 minutes, and he can do 20 pushups in 20 seconds. A. Who has an absolute advantage at running? B. Who has an absolute advantage at doing pushups? C. Who has a comparative advantage at running? D. Who has a comparative advantage at doing pushups?

Answer 1

Step-by-step explanation:

A. Ana has an absolute advantage at running since she can run 3 miles in 24 minutes, which is faster than Paulo's time of 30 minutes.

B. Paulo has an absolute advantage at doing push ups since he can do 20 pushups in 20 seconds, which is faster than Ana's time of 40 seconds.

C. To identify who has a comparative advantage at running, we need to calculate the opportunity cost of each person. Ana's opportunity cost of running is 20 pushups in 40 seconds, while Paulo's opportunity cost of running is 20 pushups in 20 seconds. Therefore, Ana has a lower opportunity cost of running as compared to Paulo. Hence, Ana has a comparative advantage at running.

D. Similarly, to identify who has a comparative advantage at doing pushups, we need to calculate the opportunity cost of each person. Ana's opportunity cost of doing pushups is 1 mile in 8 minutes, while Paulo's opportunity cost of doing pushups is 1 mile in 90 seconds. Therefore, Paulo has a lower opportunity cost of doing pushups as compared to Ana. Hence, Paulo has a comparative advantage at doing pushups.