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    absolute advantage in producing both products

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    As a manager of a financial planning business I have two financial planners, Phil and Francis. In an hour, Phil can produce either one financial statement or answer 10 phone calls, while Francis can either produce 3 financial statements or answer 12 phone calls. Does either person have an absolute advantage in producing both products$ should these two planners be self-sufficient (each producing statements and answering phones) or specialize? Be sure to show your work

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    Solution Preview

    Francis has an absolute advantage. He can produce 3 financial statements against Phil's 1 and he can answer 12 phone calls against Phil's 10.
    These two planners should specialize because; the ...

    Solution Summary

    Determine absolute advantage in producing both products.

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