Question

So Im a little confused on the difference between these two questions:

Ted can wax 4 cars per day or wash 12 cars. Tom can wax 3 cars per day or wash 6. What is each man’s opportunity cost of washing a car?

I understand that for Ted its 1/3 and for Tom its 1/2. You divide 4/12 and 3/6 to find the opportunity cost.

What I don't understand is why for this question you divide 60/20 and 30/15?

Ted can wax a car in 20 minutes or wash a car in 60 minutes. Tom can wax a car in 15 minutes or wash a car in 30 minutes. What is each man’s opportunity cost of washing a car? Who has a comparative advantage inwashing cars?

Answer 1

you question " Ted can wax a car in 20 minutes or wash a car in 60 minutes. Tom can wax a car in 15 minutes or wash a car in 30 minutes. What is each man’s opportunity cost of washing a car? Who has a comparative advantage inwashing cars?"

you are asked to find opportunity cost of washing a car which as same as in first question

20 : 60 = 1 : 3

15 : 30 = 1 : 2

but when we have to find out comparative cost advantage then we have to find out which man has comparative advantage in wahing car in comparison to other and which man has ability to wash more care in comparison to others , that is why we divide

60 /20 = 3 car / minute

30/15 = 2 car / minute

in which Ted has comparative advatage to Tom in wahsing car. Ted can wash 1 more car in comparison to Tom.