Question

A rock carving from ancient Norway depicts two identical people doing different jobs in the same boat: one uses a bow to hunt while the other paddles. How does this early example illustrate the benefits of trade?

A.) One learns to be very good at paddling, and one learns to be very good at hunting; this is an example of specialization and division of knowledge
B.) There is no trade in this example, since no goods are being exchanged.
C.) The paddler is stronger than the hunter, so the paddler sacrifices a lot by hunting; this is an example of comparative advantage
D.) One prefers to hunt, while the other prefers to paddle the boat; this is an example of diversified preferences

Answer 1

Answer:

A.) One learns to be very good at paddling, and one learns to be very good at hunting; this is an example of specialization and division of knowledge

Explanation:

Both the paddler and the hunter concentrate on their areas of strength and develop it over time, this gives them comparative advantage in that field.

Trading is about exchanging what you have for what you don't have.

The hunter has to be transported to where he will hunt. The paddler will gain from the food the hunter will catch. So both of them are leveraging their comparative advantage to get what they want.