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What is the implication for free trade of the theory of comparative advantage?
Under the theory of comparative advantage two nations that each have a cost advantage in the production of a specific product would both benefit from free trade by selling to each other since the total output of both nation's products sold would increase. The mathematical theory of comparative advantage was formalized by David Ricardo in 1817 and hence became known as the "Ricardian model." Economists have long debated the usefulness of the comparative advantage model in the real world since it is counter-intuitive to many people due to the fact that the model is based on two countries producing only two goods and only one factor of production (such as labor). In addition, the model computes comparative cost advantages based on which nation produces goods at a lower opportunity cost which implies that a nation would have to forgo the production of other goods in order to achieve the lowest comparative advantage. Many economists and student of foreign trade prefer to use the theory of absolute advantage in production which is easy to understand since it is intuitive. Under the absolute advantage theory two countries that each produce a particular good at a much lower cost than the other would both become wealthier as they increased production to sell their goods to each other.
When a firm is operating at an efficient scale?
Efficient scale is the smallest amount of production a company can achieve while still taking full advantage of economies of scale with regards to supplies and costs. In classical economics, the minimum efficient scale is defined as the lowest production point at which long-run total average costs (LRATC) are minimized.
What is the economic basis for trade?
The economic basis for trade lies in the principle of comparative advantage, which suggests that countries or entities can benefit by specializing in the production of goods and services where they have a relative efficiency. This specialization allows for increased overall production and consumption beyond what each could achieve individually. By trading, nations can access a broader array of goods at lower opportunity costs, leading to improved resource allocation and enhanced economic welfare. Additionally, trade fosters competition and innovation, further driving economic growth.
When does a company achieve a sustainable competitive advantage?
when buyers prefer its products over competitors' in the long term
To realize full production a society must achieve what?
Both allocative and productive efficiency
What is the implication for free trade of the theory of comparative advantage?
Under the theory of comparative advantage two nations that each have a cost advantage in the production of a specific product would both benefit from free trade by selling to each other since the total output of both nation's products sold would increase. The mathematical theory of comparative advantage was formalized by David Ricardo in 1817 and hence became known as the "Ricardian model." Economists have long debated the usefulness of the comparative advantage model in the real world since it is counter-intuitive to many people due to the fact that the model is based on two countries producing only two goods and only one factor of production (such as labor). In addition, the model computes comparative cost advantages based on which nation produces goods at a lower opportunity cost which implies that a nation would have to forgo the production of other goods in order to achieve the lowest comparative advantage. Many economists and student of foreign trade prefer to use the theory of absolute advantage in production which is easy to understand since it is intuitive. Under the absolute advantage theory two countries that each produce a particular good at a much lower cost than the other would both become wealthier as they increased production to sell their goods to each other.
What advantage means?
If you have an advantage you are in a better position to achieve something. For instance:- "The athlete with the longer legs had the advantage in the 100m hurdle race".
Can Ethiopia achieve tecnological advantage in the future?
probally not
Can you able to achieve hypothetical temperature?
Scientist can achieve almost hypothetical absolute zero using laser cooling trapping atom motion. The lowest temperature achieve is now approximately 0.00015 K. For absolute 0 K without any digit, it would be a very challenging task that may never be achieve.
What is personal best?
personal best is trying to achieve the absolute optimum that one possibly can achieve on one's own, or with the assistance of others.
Who is a oppurtunist?
A person who takes advantage if any opportunity to achieve a goal.
Why do all organizations need to rely on groups and teams to achieve their goals and gain competitive advantage?
Explain and discuss why organizations need to rely on groups and teams to achieve their goals and gain a competitive advantage
What is a scale based strategy?
A scale-based strategy involves increasing production or expanding operations to reduce costs and increase efficiency. This approach relies on economies of scale to achieve lower unit costs as the volume of production increases. By maximizing output and taking advantage of bulk discounts, companies can improve their competitiveness and profitability.
What motivation require to achieve absolute customer satisfication?
customer sanctification in our service & good work
How does OPEC stabilize the market price of oil?
OPEC stabilizes the market price of oil by controlling the production levels of its member countries. By adjusting production quotas, OPEC can influence the supply of oil in the market, which in turn affects prices. Additionally, OPEC meetings allow member countries to coordinate and align their production decisions to achieve price stability.
When a firm is operating at an efficient scale?
Efficient scale is the smallest amount of production a company can achieve while still taking full advantage of economies of scale with regards to supplies and costs. In classical economics, the minimum efficient scale is defined as the lowest production point at which long-run total average costs (LRATC) are minimized.
Why did Robespierre the the terror was necessary to achieve the goals of the revolution?
He felt if he did this, it would advantage him politically.
