In simple words (because I am really confused) please could you explain what comparative advantage is within international trade and possibly give an example?
From what I know is that comparative advantage is when countries only produce the products they are effcient in making and then they trade the products they have made with the international market.
However in some research I have read that 'comparative advantage considers which country gives up least to produce each of the products' etc... What are they talking about?
I am so confused!!
I have been on this link and understood it to a certain point and then confused myself again:
http://answers.yahoo.com/question/index?qid=20090212182349AAD4kTv
(I completely understand what absoloute advantage is if that helps)
Please could you just give me a simple explanation of what it is!
Your help is greatly appreciated! Thank you!
From what I know is that comparative advantage is when countries only produce the products they are effcient in making and then they trade the products they have made with the international market.
However in some research I have read that 'comparative advantage considers which country gives up least to produce each of the products' etc... What are they talking about?
I am so confused!!
I have been on this link and understood it to a certain point and then confused myself again:
http://answers.yahoo.com/question/index?qid=20090212182349AAD4kTv
(I completely understand what absoloute advantage is if that helps)
Please could you just give me a simple explanation of what it is!
Your help is greatly appreciated! Thank you!