Chapter 33: Q.11 (page 803)
Is it possible to have a comparative advantage in the production of a good but not to have an absolute advantage? Explain
Short Answer
Yes
Chapter 33: Q.11 (page 803)
Is it possible to have a comparative advantage in the production of a good but not to have an absolute advantage? Explain
Yes
All the tools & learning materials you need for study success - in one app.
Get started for free
From earlier chapters you will recall that technological change shifts the average cost curves. Draw a graph showing how technological change could influence intra-industry trade.
Does intra-industry trade contradict the theory of comparative advantage?
In World Trade Organization meetings, what do you think low-income countries lobby for?
You just overheard your friend say the following: “Poor countries like Malawi have no absolute advantages. They have poor soil, low investments in formal education and hence low-skill workers, no capital, and no natural resources to speak of. Because they have no advantage, they cannot benefit from trade.” How would you respond?
Why does the United States not have an absolute advantage in coffee?
What do you think about this solution?
We value your feedback to improve our textbook solutions.