ECO100Y5 Lecture Notes - Lecture 15: Comparative Advantage, Absolute Advantage
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ECO100Y5 Full Course Notes
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Given the same resources, the ability to produce more of a good or service than competitors. The ability to produce a good or service with lower oc than competitors. You will specialize in the good which you have comparative advantage. Two parties trade with each other a good or service they have comparative advantage. Put price between oc of 2 parties for good a. External economics- once an industry becomes established in an area, firms that locate in that area gain advantages over firms located in other places.
