Asked by
Amber Morrant
on Oct 25, 2024Verified
International trade based on comparative advantage allows a country to produce outside its production possibility frontier.
Comparative Advantage
The capacity of a person, business, or nation to manufacture a product or deliver a service with a smaller opportunity cost than that of their rivals.
Production Possibility Frontier
A curve depicting all maximum output possibilities for two or more goods given a set of inputs (resources, labor, technology).
- Digest the notion of comparative advantage and its significance for international commerce.
Verified Answer
RS
Learning Objectives
- Digest the notion of comparative advantage and its significance for international commerce.