Elijah and Aneesha are farmers. Each one owns an 18-acre plot of land. The following table shows the amount of watermelon and zucchini each farmer can produce per year on a given acre. Each farmer chooses whether to devote all acres to producing watermelon or zucchini or to produce watermelon on some of the land and zucchini on the rest.
Elijah & 28 & 7 \
Aneesha & 18 & 6 \
Elijah has an absolute advantage in the production of watermelon, and Aneesha has an absolute advantage in the production of zucchini.
Elijah's opportunity cost of producing 1 pound of zucchini is [ ] pounds of watermelon, whereas Aneesha's opportunity cost of producing 1 pound of zucchini is [ ] pounds of watermelon. Because Elijah has a [ ] opportunity cost of producing zucchini than Aneesha, [ ] has a comparative advantage in the production of zucchini, and [ ] has a comparative advantage in the production of watermelon.
Answer (2)
Calculate Elijah's opportunity cost of producing 1 pound of zucchini: 7 28 = 4 pounds of watermelon.
Calculate Aneesha's opportunity cost of producing 1 pound of zucchini: 6 18 = 3 pounds of watermelon.
Compare the opportunity costs: Aneesha has a lower opportunity cost in zucchini production.
Conclude that Aneesha has a comparative advantage in zucchini, and Elijah has a comparative advantage in watermelon. Therefore, the final answer is: Elijah's opportunity cost of producing 1 pound of zucchini is 4 pounds of watermelon, whereas Aneesha's opportunity cost of producing 1 pound of zucchini is 3 pounds of watermelon. Because Elijah has a hi g h er opportunity cost of producing zucchini than Aneesha, A n ees ha has a comparative advantage in the production of zucchini, and El ijah has a comparative advantage in the production of watermelon.
Explanation
Understanding the Problem We are given the production rates of watermelon and zucchini for Elijah and Aneesha. We need to find the opportunity costs for each farmer to determine comparative advantages.
Calculating Elijah's Opportunity Cost Elijah can produce 28 pounds of watermelon or 7 pounds of zucchini per acre. To find Elijah's opportunity cost of producing 1 pound of zucchini, we calculate how many pounds of watermelon he foregoes. This is the ratio of watermelon production to zucchini production: 7 pounds of zucchini 28 pounds of watermelon = 4 pounds of watermelon per pound of zucchini So, Elijah's opportunity cost of producing 1 pound of zucchini is 4 pounds of watermelon.
Calculating Aneesha's Opportunity Cost Aneesha can produce 18 pounds of watermelon or 6 pounds of zucchini per acre. To find Aneesha's opportunity cost of producing 1 pound of zucchini, we calculate how many pounds of watermelon she foregoes. This is the ratio of watermelon production to zucchini production: 6 pounds of zucchini 18 pounds of watermelon = 3 pounds of watermelon per pound of zucchini So, Aneesha's opportunity cost of producing 1 pound of zucchini is 3 pounds of watermelon.
Comparing Opportunity Costs Now we compare the opportunity costs. Elijah's opportunity cost of producing 1 pound of zucchini is 4 pounds of watermelon, while Aneesha's opportunity cost is 3 pounds of watermelon. Since Aneesha has a lower opportunity cost of producing zucchini (3 pounds of watermelon < 4 pounds of watermelon), Aneesha has a comparative advantage in zucchini production.
Determining Comparative Advantages Since Aneesha has a comparative advantage in zucchini production, Elijah must have a comparative advantage in watermelon production.
Final Answer Therefore, Elijah's opportunity cost of producing 1 pound of zucchini is 4 pounds of watermelon, whereas Aneesha's opportunity cost of producing 1 pound of zucchini is 3 pounds of watermelon. Because Elijah has a higher opportunity cost of producing zucchini than Aneesha, Aneesha has a comparative advantage in the production of zucchini, and Elijah has a comparative advantage in the production of watermelon.
Examples
Understanding comparative advantage is crucial in international trade. For instance, if one country can produce cars at a lower opportunity cost (sacrificing fewer resources) than another, it has a comparative advantage in car production. This principle guides countries to specialize in producing goods and services where they have a lower opportunity cost, leading to more efficient resource allocation and increased overall production. By specializing and trading, both countries can benefit, achieving higher levels of consumption than they could if they tried to produce everything themselves. This concept applies not only to countries but also to individuals and businesses, promoting specialization and trade for mutual benefit.
Elijah's opportunity cost of producing 1 pound of zucchini is 4 pounds of watermelon, while Aneesha's opportunity cost is 3 pounds of watermelon. Therefore, Aneesha has a comparative advantage in zucchini production, while Elijah has a comparative advantage in watermelon production.
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