Figure 3-5
-Refer to Figure 3-5. Ginger has an absolute advantage in
A)Ginger has an absolute advantage in tap shoes and Fred has a comparative advantage in ballet slippers.
B)Ginger has an absolute advantage in both goods and Fred has a comparative advantage in neither good.
C)Ginger has an absolute advantage in ballet slippers and Fred has a comparative advantage in tap shoes.
D)Ginger has an absolute advantage in neither good and Fred has a comparative advantage in both goods.

Question

Figure 3-5 
-Refer to Figure 3-5. Ginger has an absolute advantage in
A)Ginger has an absolute advantage in tap shoes and Fred has a comparative advantage in ballet slippers. 
B)Ginger has an absolute advantage in both goods and Fred has a comparative advantage in neither good. 
C)Ginger has an absolute advantage in ballet slippers and Fred has a comparative advantage in tap shoes. 
D)Ginger has an absolute advantage in neither good and Fred has a comparative advantage in both goods.

Quizplus · Accepted Answer

Ginger can produce more ballet slippers per hour than Fred can, meaning she has an absolute advantage in that good. However, there is no information given about their ability to produce tap shoes, so we cannot determine who has an absolute advantage in that good. Fred does not have a comparative advantage in ballet slippers because we do not know his opportunity cost of producing them. Therefore, the only correct answer is C, which states that Ginger has an absolute advantage in ballet slippers and Fred has a comparative advantage in tap shoes (which can be inferred since Ginger does not have an absolute advantage in that good).

Figure 3-5 -Refer to Figure 3-5. Ginger Has an Absolute Advantage in Absolute