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An absolute advantage is when trading only occurs between one or two parties. This is common in the Philippine economy since most industries are monopolistic.
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∙ 9y ago
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What type of economy does Philippine have?
free trade
1 Discuss the growing importance of the global market and the roles of comparative advantage and absolute advantage in global trade?
discuss the growing importance of the global market and the roles of comparative advantage and absolute advantage in global trade?
What example of absolute advantage that one country has in international trade today and tell why wouldn't this advantage is not sustainable today?
need answer
Difference between comparative cost advantage and absolute cost advantage?
Absolute advantage and comparative advantage are two basic concepts to international trade. Under absolute advantage, one country can produce more output per unit of productive input than another. With comparative advantage, if one country has an absolute (dis)advantage in every type of output, the other might benefit from specializing in and exporting those products, if any exist.A country has an absolute advantage economically over another, in a particular good, when it can produce that good at a lower cost. Using the same input of resources a country with an absolute advantage will have greater output. Assuming this one good is the only item in the market, beneficial trade is impossible. An absolute advantage is one where trade is not mutually beneficial, as opposed to a comparative advantage where trade is mutually beneficial.A country has a comparative advantage in the production of a good if it can produce that good at a lower opportunity cost relative to another country. The theory of comparative advantage explains why it can be beneficial for two parties (countries, regions, individuals and so on) to trade if one has a lower relative cost of producing some good. What matters is not the absolute cost of production but the opportunity cost, which measures how much production of one good, is reduced to produce one more unit of the other good.
What is advantage or disadvantage of free trade?
explain the advantages and disadvantages of active trade union movement to employers,employee and the economy?
What type of economy does Philippine have?
free trade
1 Discuss the growing importance of the global market and the roles of comparative advantage and absolute advantage in global trade?
discuss the growing importance of the global market and the roles of comparative advantage and absolute advantage in global trade?
What example of absolute advantage that one country has in international trade today and tell why wouldn't this advantage is not sustainable today?
need answer
Difference between comparative cost advantage and absolute cost advantage?
Absolute advantage and comparative advantage are two basic concepts to international trade. Under absolute advantage, one country can produce more output per unit of productive input than another. With comparative advantage, if one country has an absolute (dis)advantage in every type of output, the other might benefit from specializing in and exporting those products, if any exist.A country has an absolute advantage economically over another, in a particular good, when it can produce that good at a lower cost. Using the same input of resources a country with an absolute advantage will have greater output. Assuming this one good is the only item in the market, beneficial trade is impossible. An absolute advantage is one where trade is not mutually beneficial, as opposed to a comparative advantage where trade is mutually beneficial.A country has a comparative advantage in the production of a good if it can produce that good at a lower opportunity cost relative to another country. The theory of comparative advantage explains why it can be beneficial for two parties (countries, regions, individuals and so on) to trade if one has a lower relative cost of producing some good. What matters is not the absolute cost of production but the opportunity cost, which measures how much production of one good, is reduced to produce one more unit of the other good.
What is advantage or disadvantage of free trade?
explain the advantages and disadvantages of active trade union movement to employers,employee and the economy?
What are the effects of the Philippine topography in the economic life its people?
The area of the Philippines is a major influence in the economy. It determines who they can trade with and what foods can be produced.
Can there be trade between two nation even if one has absolute disadvantage?
Yes, and not only that, but such trade can be profitable for both countries due to comparative advantage.
What is the difference between theory of absolute advantage and a theory of comparative advantage?
The theory of absolute advantage states that a country should produce goods that it can produce more efficiently than other countries. On the other hand, the theory of comparative advantage argues that a country should specialize in producing goods that it can produce at a lower opportunity cost compared to other countries, even if it does not have an absolute advantage in that good.
What are the assumptions of absolute advantage theory?
That a country has the best advantage of making all products, all things constant. It shows what a country would have if it didn't trade.
Reasons for entering international markets?
There are 2 reasons for entering the international market or trade. 1.Absolute advantage :nations have an absolute advantage in proudcing goods. For example the US will produce 150 of x and 200 of Y and the EU will only produce 100 of x and 150 of Y. Here the USA produces more of both goods and has an absolute advantage. 2.Comparative advantage :This is when nations can produce a good with a smaller opertunity cost in comparrisant to its trade rivals.
How has Belgiums location affected its economy?
Its central geographic location makes then have the advantage of world trade with other nations.
What is trade in the economy?
A trade in a economy is what they trade for money.
