1 / 12

Input Method

Input Method. Men, women, and time needed. My wife is good at ironing while I am good at changing tires. Minutes needed to produce. What does this graph immediately tell you?. Women are better at everything therefore I should sit on the couch while my wife works. Minutes needed to produce.

elma
Download Presentation

Input Method

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Input Method • Men, women, and time needed.

  2. My wife is good at ironing while I am good at changing tires • Minutes needed to produce • What does this graph immediately tell you?

  3. Women are better at everything therefore I should sit on the couch while my wife works • Minutes needed to produce

  4. Women are better at everything therefore I should sit on the couch while my wife works • Minutes needed to produce • To iron 1 shirt women give up 2 tire changes • To iron 1 shirt men give up 1 1/3 tire changes • To change 1 tire women give up 1/2 a shirt ironed • To change 1 tire men give up 3/4 a shirt ironed

  5. Absolute and Comparative Advantage • A person or nation has an absolute advantage when it can produce a particular good at a lower cost than another person or nation. • Comparative advantage is the ability of one person or nation to produce a good at a lower opportunity cost than that of another person or nation.

  6. The law of comparative advantage states that nations are better off when they produce goods and services for which they have a comparative advantage in supplying.

  7. Output method • UK • China

  8. Cheese and Cars; A simple world • Units produced per unit of production • To make one car the UK gives up • To make one ton of chz the UK gives up • To make one car China gives up • To make one ton of chz China gives up

  9. Comparative Advantage

  10. Comparative Advantage

  11. Comparative Advantage

More Related