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ECON 213 PROBLEM SET 1 Name: ______________________________________________ Problem Set 1 is due by 11: (ET) on Monday of Module/Week 2. Based on the...
What is the market you are dealing with?
Which curve(s) change(s)? Based on the lists in the text of what causes demand and supply to shift, what are the causes of these shifts?
In what direction do they change?
What happens to the equilibrium price and quantity after these changes are put into effect? Do they go up, go down, or stay the same?
P: _______________________ Q: _______________________
Mario has reached a crossroads in his life. He is trying to decide whether to change careers. Currently, Mario makes pizzas, but he is considering entering a different line of work testing video games. Mario can either test 6 games or toss 12 pizzas in a day. Interestingly, Mario’s friend Luigi is in a similar predicament. Luigi can test 3 games or toss 2 pizzas during a day.
Mario’s opportunity cost of testing one game: ___________________________
(yes, you can test fractional games)
Luigi’s opportunity cost of testing one game: ___________________________
(yes, you can test fractional games)
Mario’s opportunity cost of tossing one pizza: ___________________________
(yes, you can have fractional pizzas)
Luigi’s opportunity cost of tossing one pizza: ___________________________
(yes, you can have fractional pizzas)
Who has an absolute advantage in testing games? ________________________
Who has the comparative advantage in testing games? _____________________
Who has the comparative advantage in making pizzas? _____________________
