Students will be able to:
- Understand the definition of trade.
- Understand the benefits of trade using comparative advantage.
In this economics video, students will learn about the benefits of trade using comparative advantage.
This video teaches the concepts of Benefits of Trade and Comparative Advantage. Comparative advantage is the principle which holds that world output is higher if every country produces and trades the good in which it has a comparative advantage. A nation’s comparative advantage occurs when it focuses on producing the good in which the opportunity cost of production is lowest.