Smith and Jones comprise a two-person economy. Their hourly rates of production are shown below. If Smith and Jones are dividing their time efficiently and producing more than 10 computers and fewer than 120 calculators per hour, then Smith will ______ and Jones will ______.

Question

Smith and Jones comprise a two-person economy. Their hourly rates of production are shown below.  If Smith and Jones are dividing their time efficiently and producing more than 10 computers and fewer than 120 calculators per hour, then Smith will ______ and Jones will ______.

Quizplus · Accepted Answer

Smith has a comparative advantage in producing computers so should only make those. Jones should make the remaining computers and all of the calculators.

Smith and Jones Comprise a Two-Person Economy