rch Refer to Table 22 Which of the following statements is t

rch Refer to Table 2.2. Which of the following statements is true? O Molly has a comparative advantage in both avatar design and tattoo design. O Pete has a comparative advantage in avatar design and Molly has a comparative advantage in tattoo design O Pete has a comparative advantage in both avatar design and tattoo design O Molly has a comparative advantage in avatar design and Pete has a comparative advantage in tattoo design QUESTION 18 The economic problem can best be stated as o Given scarce resources, how exactly do societies go about deciding what to produce, how to produce t, and for whom to produce? O How can the economy improve technology so as to shit the production possibility frontier up and to the right? O What is the best rate of economic growth for a society? o Given the fact that the econ nomy is inefficient. how much and what type of government intervention should be used to improve the efficiency of the economy? The market system works by getting each person motivated by his or her own self-interest, to produce products tor other people c True QUESTION 19 False

Solution

1.For Molly

6 avatar designs =3 tattoo designs

1 avatar design=3/6=1/2 tattoo designs

1 tattoo designs=2 avatar designs

For Pete

8 avatar design=2 tattoo designs

1 avatar design=1/4 tattoo designs

1 tattoo design=4 avatar design.

Comparative design is defines by lower opportunity cost of production.

Molly has comparative advantage over tattoo design and Pete has comparative advantage over avatar designs.

Answer-Second option

18.Resources are limited and scarce and needs are unlimited.Therefore,every society has to decide what to produce,for whom to produce and in what quantity This is the fundamental economic problem.

Answer-First option.

19.The market system motivates to produce for other based on self interest (wages or payments in return of production).But it also works on the consumer\'s desire to purchase the products.

Answer-False.