Asked by juan manuel iglesias on May 03, 2024
Verified
What is the principle of comparative advantage?
Comparative Advantage
The ability of an individual, firm, or country to produce a good or service at a lower opportunity cost than competitors.
- Comprehend the principle of comparative advantage and its relevance to international trade.
Verified Answer
JW
Jessica WatsonMay 07, 2024
Final Answer :
The principle of comparative advantage is the proposition that an individual, region, or nation will benefit if it specializes in producing goods for which its own opportunity costs are lower than the opportunity costs of a trading partner, and then exchanging some of the products in which it specializes for other desired products produced by others.
Learning Objectives
- Comprehend the principle of comparative advantage and its relevance to international trade.
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