Question

Bobby is a skilled mechanic who is also good at mowing lawns. He can mow his lawn faster and cheaper than the local lawn care service, Weeds. Bobby can earn fifty dollars an hour working as a mechanic. Weeds charges fifteen dollars an hour to mow lawns. It only takes Bobby one hour to mow his lawn, while it would take Weeds two. Should Bobby mow his lawn or hire Weeds to do it? A. It is Bobby's comparative advantage to work as a mechanic because of the opportunity cost, so he should hire Weeds to mow his lawn. B. It is Bobby's absolute advantage to mow his own lawn because he can mow it faster than Weeds, so he should mow his own lawn. C. Since Weeds has the absolute advantage in lawn care, Bobby should hire them to mow his lawn. D. Since Weeds has the comparative advantage in lawn care, Bobby should mow his own lawn.

Answer 1

Bobby is a skilled mechanic who is also good at mowing lawns. He can mow his lawn faster and cheaper than the local lawn care service, Weeds. Bobby can earn fifty dollars an hour working as a mechanic. Weeds charges fifteen dollars an hour to mow lawns. It only takes Bobby one hour to mow his lawn, while it would take Weeds two. Should Bobby mow his lawn or hire Weeds to do it? A. It is Bobby's comparative advantage to work as a mechanic because of the opportunity cost, so he should hire Weeds to mow his lawn.