Answer to Question #193266 in Microeconomics for Patel

Question

Suppose a two-person household provides two products: taxi rides and meal deliveries. 

Person A can provide 4 taxi rides or 2 meal deliveries in an hour. 

Person B can provide 5 taxi rides or 4 meal deliveries in an hour.

Who has the absolute advantage in the provision of taxi rides? Who has the comparative advantage in the provision of taxi rides?

1-Absolute advantage: Person B

Comparative advantage: Person A

2-Absolute advantage: Person A

Comparative advantage: Person B

3-Absolute advantage: Person A

Comparative advantage: Person A

4-Absolute advantage: Person B

Comparative advantage: Person B

Answer 1

1-Absolute advantage: Person B

Comparative advantage: Person A