According to the theory of comparative advantage, a country can came from trade, regardless of how efficient it could produce all goods relative to other countries
Added by Eric R.
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Comparative advantage occurs when a country can produce a good or service at a lower opportunity cost than another country, meaning it sacrifices less of other goods to produce it. Show more…
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Use comparative advantage, two countries and two goods, to explain why every country can be better off from international trade.
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THEORY OF COMPARATIVE ADVANTAGE suggests that it makes sense for a country to specialize in producing goods that it can produce most efficiently while buying goods that it can produce relatively less efficiently from other countries suggests that unrestricted free trade brings about increased world production, that is, that trade is a positive-sum game. suggests that opening a country to free trade stimulates economic growth, which creates dynamic gains from trade. The empirical evidence seems to be consistent with this claim
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