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Elliot and his friend Olivia are both volunteers at a cat rescue. The shelter supervisor asks the two of them to clean out kennels and haul bags of cat food from the donation area to storage. Elliot knows from his last time volunteering that he can clean out 8 kennels in an hour or move 5 bags of cat food. Olivia can clean out 10 kennels in an hour or move 6 bags of cat food. Olivia suggests that they should both do equal amounts of each task.
Answer the following questions to determine if Olivia is making the best decision.
a. Who has an absolute advantage in doing each task?
b. What are Olivia’s opportunity costs of doing each task?
Note: Please round your answer to 2 decimal places if necessary.
Olivia's opportunity cost of cleaning a kennel is food bags moved and her opportunity cost of moving a bag of cat food is kennels cleaned.
c. What are Elliot's opportunity costs of doing each task?
Note: Please round your answer to 2 decimal places if necessary.
Elliot's opportunity cost of cleaning a kennel is food bags moved and his opportunity cost of moving a bag of cat food is kennels cleaned.
d. Who has a comparative advantage in doing each task?
e. Who should do each task to minimise the amount of time they both spend?
f. Was Olivia’s suggestion the best possible way to allocate your time? Why or why not?
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