Question

Vincent and Jean are two cooks who work in a village. Each of them can either bake cakes or make pizzas. Every ingredient is readily available to them, and the only scarce resource is the cooks' time. Vincent can bake 10 cakes or make 5 pizzas in an hour. Jean can bake 12 cakes or make 8 pizzas in an hour. Please answer the four questions.1. Which cook has the absolute advantage in baking cakes? a. Vincentb. Jeanc. Neither2. Which cook has the absolute advantage in making pizzas? a. Vincent

b. Jean
c. Neither3. Which cook has the comparative advantage in baking cakes? a. Vincent
b. Jean
c. Neither4. Which cook has the comparative advantage in making pizzas?a. Vincent
b. Jean
c. Neither

Answer 1

b. Jean

b. Jean

a. Vincent

b. Jean

Step-by-step explanation:

A person has a comparative advantage in production if he produces at a lower opportunity cost when compared with other people .

A person has an absolute advantage in the production of a good or service If he produces more quantity of the good when compared with other people.

Jean has an absolute advantage in the production of both pizza and cake because he produces more quantities of both goods when compared with Vincent.

The opportunity cost of producing cake :

Vincent = 5/10 = 0.2

Jean = 8/12 = 0.67

The opportunity cost of producing pizza:

Vincent = 10/5 = 2

Jean = 12/8 = 1.5

Vincent has a comparative advantage in the production of cake because he produces at a lower opportunity cost when compared with Jean.

Jean has a comparative advantage in the production of pizza because he produces at a lower opportunity cost when compared with Vincent.

I hope my answer helps you