Principles of Microeconomics / Unit 17 MIC 1603 short lesson, about 20 seconds
Advantage and Trade, Restated
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The idea
Absolute advantage is producing more with the same resources; comparative advantage is producing at lower opportunity cost. Trade follows comparative advantage, no country holds it in both goods, and both gain at any ratio between their opportunity costs.
In practice
The country worse at everything still lags least somewhere.
Where people slip
Compute opportunity cost by dividing; comparing raw outputs gives absolute advantage again.
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