Question

If kate and sarah both specialize in the good in which they have a comparative advantage the

Answer 1

Kate and Sarah own a bakery together. The two figures illustrate the production possibilities available to them if they work at their bakery for 8 hours a day.

If kate and sarah both specialize in the good in which they have a comparative advantage the;

Answer;

-the total production of bread will be 16 and total production of pies will be 17.

Explanation;

-Comparative advantage is the ability of a firm or individual to produce goods and/or services at a lower opportunity cost than other firms or individuals. A comparative advantage gives a company the ability to sell goods and services at a lower price than its competitors and realize stronger sales margins.

-It is important to note that a comparative advantage is not the same as an absolute advantage. The latter implies that one is the best at something, while the former relates more to the costs of the particular endeavor.