1 / 6

Ch. 4.3 How do People and Nations Benefit from Specialization & Trade?

Ch. 4.3 How do People and Nations Benefit from Specialization & Trade? . Essential Question: WHO GAINS from trade?. Absolute Advantage. The condition that exists when someone can produce a good or service using fewer resources than someone else. Comparative Advantage.

yasuo
Download Presentation

Ch. 4.3 How do People and Nations Benefit from Specialization & Trade?

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Ch. 4.3 How do People and Nations Benefit from Specialization & Trade? Essential Question: WHO GAINS from trade?

  2. Absolute Advantage The condition that exists when someone can produce a good or service using fewer resources than someone else.

  3. Comparative Advantage The condition that exists when someone can produce a good or service at a lower opportunity cost than someone else. (Opportunity cost, remember is the value of what you give up to get something else)

  4. Specialization & Trade benefits both trading partners

  5. When the principle of comparative advantage guides who produces what, society usually benefits

  6. Some of the factors that give rise to comparative advantage • Climate • Natural resources • Education • Wage levels • Technological differences

More Related