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Davis Florist has two employees, Anita and Jerome, and two tasks that need to be completed, floral arrangements and floral delivery. It takes Anita 30 minutes to finish one floral arrangement and 40 minutes to make a delivery. It takes Jerome 10 minutes to finish one floral arrangement and 30 minutes to make a delivery. Each worker works six hours per day.

Required:
Suppose that, initially, both Jerome and Anita spend four hours each day doing floral arrangements and two hours each day doing deliveries. Now suppose they change their tasks, so that each individual does nothing but the task in which she or he has a comparative advantage. How many more floral arrangements and deliveries could they produce each day?

Respuesta :

Answer:

4 more floral arrangements, 2 more deliveries  - with Jerome & Anita specialisation in comparative advantage (arrangements & deliveries) resp.

Explanation:

Time available = 6 hours, each worker, per day

                Arrangement                         Delivery

Anita         30 mints (2 per hr)                  40 mints (1.5 per hr)

Jerome     10 mints (6 per hr)                  30 mints (2 per hr)

Jerome is comparatively more (by higher extent) productive in arrangement than Anita, relative to in case of packing. Jerome has comparative advantage in arrangement, Anita has comparative advantage in delivery.

Production before, each 4 hrs arrangement & 2 hrs delivery

  • Jerome =  (6 x 4)A + (2 x 2)D = {24A, 4D} . Anita = (2 x 4)A + (2 x 1.5)D = {8A, 3D}
  • Total = {32A, 7D}

Production after Jerome specialisation in arrangement, Anita in packing

  • Jerome = 6 x 6 = 36A , Anita = 1.5 x 6 = 9D
  • So, increase in production = {4A, 2D}  

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