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Calvin and Hobbes run a company that sells only two items: T-shirts and car decals. Calvin is fast at making decals and very slow at making T-shirts, whereas Hobbes is fast at making T-shirts and very slow at making decals. Which statements accurately describe the situation?
a. Company output will be maximized if Calvin makes all the decals and Hobbes makes all the chains.
b. Calvin has a comparative advantage for making decals.
c. Hobbes has a higher opportunity cost for making decals than Calvin.
d. Company output will be maximized if Calvin and Hobbes both divide their time equally between making decals and making chains
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Calvin and Hobbes run a company that sells only two items: T-shirts and car decals. Calvin is fast a...
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