Chloe and Cooper live on neighboring islands. Their production possibilities for coffee and doughnuts show that _______ has an absolute advantage in the production of doughnuts.

Question

BlackTom AI · Accepted Answer

Let's analyze the production possibilities for each island and focus on doughnuts as the metric.
Option a: Cooper. This would claim Cooper can produce more doughnuts with the same resources. From the graph, Cooper can produce about 6 doughnuts when coffee is 30. Chloe can produce about 10 doughnuts when coffee is 8. Since 10 > 6, Cooper does not have the absolute advantage in doughnuts. This option is incorrect.
Option b: both Chloe and Cooper. Absolute advantage means one entity can produce more of the good with the same resources. Since Chloe can produce more doughnuts (10) than Cooper (6) given their respective resource bundles, it is not the case that both have the advantage. This option is incorrect.
Option c: Chloe has an absolute advantage in producing both coffee and doughnuts. To claim Chloe has an absolute advantage in doughnuts, we only need to compare doughnut production; the statement about both goods would require Chloe also to produce more coffee with the same resources. The graph does not show Chloe strictly ahead of Cooper in coffee for equivalent resource inputs, so we cannot conclude this for both goods. This option is overly broad and incorrect.
Option d: Chloe. This option states that Chloe has the absolute advantage in producing doughnuts. Looking at the graph, Chloe produces about 10 doughnuts at the shown point, whereas Cooper produces about 6 doughnuts at his shown point. Since Chloe can produce more doughnuts with the given resources, she has the absolute advantage in doughnuts. This option is correct.
Option e: neither Chloe nor Cooper. This would be true only if neither could produce more doughnuts than the other with the same resources, which the graph disproves since Chloe clearly produces more doughnuts. This option is incorrect.

Academic Courses Test#1

Chloe and Cooper live on neighboring islands. Their production possibilities for coffee and doughnuts show that _______ has an absolute advantage in the production of doughnuts.

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