Suppose Jilbo can make 18 flower pots or 2 coffee mugs per day. Her cousin Jimbo can make 10 flower pots or 6 coffee mugs per day.
a. Graph both Jilbo and Jimbo's PPFs
b. What is the opportunity cost for Jilbo of producing 1 flower pot? of 18 flower pots?
c. What is the opportunity cost for Jimbo of producing 1 flower pot? or 10 flower pots?
d. Who has the absolute advantage in producing each good?
e. Who has the comparative advantage in producing each good?
f. Which cousin should specialize in each good? and at what price range should each good be traded for?