Suppose that greece and switzerland both produce beer and stained glass. greece's opportunity cost of producing a pane of stained glass is 4 barrels of beer while switzerland's opportunity cost of producing a pane of stained glass is 8 barrels of beer. by comparing the opportunity cost of producing stained glass in the two countries, you can tell that has a comparative advantage in the production of stained glass and has a comparative advantage in the production of beer. suppose that greece and switzerland consider trading stained glass and beer with each other. greece can gain from specialization and trade as long as it receives more than of beer for each pane of stained glass it exports to switzerland. similarly, switzerland can gain from trade as long as it receives more than of stained glass for each barrel of beer it exports to greece. based on your answer to the last question, which of the following prices of trade (that is, price of stained glass in terms of beer) would allow both switzerland and greece to gain from trade? check all that apply. 5 barrels of beer per pane of stained glass 7 barrels of beer per pane of stained glass 1 barrel of beer per pane of stained glass 20 barrels of beer per pane of stained glass

< back to assignment attempts: 1 1 keep the highest: 1 / 2 2. determining opportunity cost juanita is deciding whether to buy a suit that she wants, as well as where to buy it. three stores carry the same suit, but it is more convenient for juanita to get to some stores than others. for example, she can go to her local store, located 15 minutes away from where she works, and pay a marked-up price of $102 for the suit: store travel time each way price of a suit (minutes) (dollars per suit) local department store 15 102 across town 30 88 neighboring city 60 65 juanita makes $42 an hour at work. she has to take time off work to purchase her suit, so each hour away from work costs her $42 in lost income. assume that returning to work takes juanita the same amount of time as getting to a store and that it takes her 30 minutes to shop. as you answer the following questions, ignore the cost of gasoline and depreciation of her car when traveling. complete the following table by computing the opportunity cost of juanita's time and the total cost of shopping at each location. store opportunity cost of time price of a suit total cost (dollars) (dollars per suit) (dollars) local department store 102 across town 88 neighboring city 65 assume that juanita takes opportunity costs and the price of the suit into consideration when she shops. juanita will minimize the cost of the suit if she buys it from the . grade it now save & continue continue without saving