ECN 001A Lecture Notes - Lecture 7: Iphone 6S, Foxconn, Absolute Advantage
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ECN 001A Full Course Notes
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Econ-b05 lecture 7 notes - interdependence and the gains from trade. Example: my iphone 6s is designed by apple in cupertino, ca. Every day you rely on many people from around the world, most of whom you"ve never met, to provide you with the goods and services you enjoy. One of the ten principles from chapter 1: trade can make everyone better off. We now learn why people and nations choose to be interdependent, and how they can gain from trade. We will look at how much of both goods each country produces and consumes. If the country chooses to be self-sufficient. If it trades with the other country. The u. s. has 50,000 hours of labor available for production, per month. Producing one computer requires 100 hours of labor. Producing one ton of wheat requires 10 hours of labor. Can always trade a tenth of wheat for one computer.
