Question: The table below lists the maximum feasible quantities of digital apps and tablet devices that can be produced in 1 hour using all resourcesland, labor,
The table below lists the maximum feasible quantities of digital apps and tablet devices that can be produced in 1 hour using all resourcesland, labor, capital, and entrepreneurial talent that is available in the Southland and East Coast. In the Southland, residents can use all their resources to produce either 90 digital apps or 225 tablet devices per hour. In East Coast, residents can use all their resources to produce either 100 digital apps or 50 tablet devices per hour. Assuming constant opportunity costs of producing digital apps and tablet devices in both countries answer the following questions.
Product | Southland | East Coast |
Digital apps | 90 | 100 |
Tablet devices | 225 | 50 |
1. What is the opportunity cost of producing tablet devices in Southland? What is the opportunity cost of producing digital apps in Southland? (4 points)
2. What is the opportunity cost of producing tablet devices in East Coast? What is the opportunity cost of producing digital apps in East Coast? (4 points)
3. Which country has a comparative advantage in producing tablet devices? (4 points)
4. Which country has a comparative advantage in producing digital apps? (4 points)
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