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Business, 20.09.2020 15:01 taylord4230

Crystal and Hilary are roommates. They spend most of their time studying (of course), but they leave some time for their favorite activities: making pizza and brewing root beer. Crystal takes 4 hours to brew a gallon of root beer and 2 hours to make a pizza. Hilary takes 6 hours to brew a gallon of root beer and 4 hours to make a pizza. Required:
a. What is each roommate's opportunity cost of making a pizza? Who has the absolute advantage in making pizza? Who has the comparative advantage in making pizza?
b. If Pat and Kris trade foods with each other, who will trade away pizza in exchange for root beer?
c. The price of pizza can be expressed in terms of gallons of root beet What is the highest price at which pizza can be traded that would make both roommates better off? What is the lowest price? Explain.

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Crystal and Hilary are roommates. They spend most of their time studying (of course), but they leave...

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