ABSOLUTE ADVANTAGE

ABSOLUTE ADVANTAGE One way to answer the question about the cost of producing potatoes is to compare the inputs required by  the two producers. Economists use the term absolute advantage when comparing the productivity of one person, firm, or nation to that of...

PRODUCTION POSSIBILTIES

PRODUCTION POSSIBILTIES Suppose that the farmer and the .rancher each work 8 hours per day and can devote this’ time to growing potatoes, raising cattle, or a combination of the two. Table 1 shows the amount of time each person  requires to produce 1 ounce of...