Trade Is A Powerful Weapon Essay
Absolute advantage refers to the ability of a country to produce the bigger quantity of a product or service under any circumstance and comparative advantage refers to the capacity of a country to produce something at a lower opportunity cost. Taking those two factors in consideration is crucial to determine the kind of product, the amount of trade and the price of the interchange.
Trade is a powerful weapon, it allows every country to specialize in the ability they are better off and it facilitate the economic growth. It brings the possibility of an increase money income in countries with lower gross domestic product. Countries such as China, India and Brazil are among the main sources of trading between undeveloped countries and higher economies like Europe and the United States.
For example, if a country specializes in the production of computers and the production levels for that output are higher than the production of airplanes, the…