economics

ECO110 HA: Economics for Life

Writing Assignment #2

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For this assignment, consider the following circumstance:

Michael Jordan can probably mow his lawn faster than anyone else. But just because he can mow his lawn fast, does this mean he should? Let’s say Jordan can mow his lawn in 2 hours while Debbie, the girl next door, can mow Jordan’s lawn in 4 hours.

Suppose that in the same 2 hours it takes him to mow his lawn, he could film a Nike commercial and earn $10,000. If Debbie mows the lawn, Michael would pay her $50. Her next best alternative to make some money is to wrap meat at Wegman’s where she earns $8 an hour.

Your job in this writing assignment is to take a page of description and a few simple calculations to analyze the situation for Michael and Debbie. Who should do what? Be sure to answer the following questions along the way.

What are Michael’s opportunity costs for mowing and for not mowing yard himself?What are Debbie’s opportunity costs for mowing and for not mowing yard?Who has the absolute advantage in mowing the lawn?Who has the relative comparative advantage in lawn mowing?What are the gains from trade that could happen if Debbie mows Michael’s yard?

Please attach a word file (a page or two at most) and be sure to describe any calculations you made in your word file and attach that file to the Writing Assignment #1 in the on-line course

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