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☆☆☆☆☆To help countries achieve sustainable development
Specialized production
Increased mobility allows producers to move jobs to lower-cost labor markets.
An improved climate for foreign investment
Environmental-protection regulations increase compliance costs and decrease economic competitiveness.
Interconnections among the people and economies of the world
Lower production costs help lure foreign investment.
Free-trade policies
Interdependence involves a loss of control over the national economy.
When they can produce it at a lower opportunity cost than other countries.
Free-trade policies
Competition with lower wages and jobs leaving the country are some of the major drawbacks of globalization.
The interest rate is fixed for five years and then changes every year afterward describes how a five or one arm mortgage works.
Think that you're country A, wanting to buy pen and paper.
Country B produces 1 million pen and 1 BILLION paper
Country C produces 1 BILLION pen and 1 million paper
Or, country B has the absolute advantage over production of paper while
country C has the absolute advantage over production of pen.
Coming back our theory of economy of scale, we know that to a certain point, increased production would lead to lower average cost and thus, lower price.
This would mean that paper from country B is cheaper than country C whereas pen from country C is cheaper than country B.
Therefore, you would choose to trade paper with country B while trading pen with country C.
And this is why it is important to making economic choices.
When a nation can use fewer resources to produce the same amount of a product, it has an absolute advantage in the production of that product.
Many developing countries do not benefit from free trade policies, because their industries are to weak to compete in the international market.
