When arelativepricedifferential exists between two goods, trade should be considered. More specifically, if therelativepriceof good A is lower in country ABC, and if therelative priceof good B is lower in country XYZ, then ABC should specialize in the production of A, XYZ should specialize in the production of B, and each country should "trade" its surplus with the other. Here is the questions.

Here's my questions:

• How would you explain the idea of comparative advantage to a family or friend who does not study business?
• Perform an Internet search to locate a real-world example and explain to your peers why that country/region has a comparative advantage in that good.

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Comparative advantage is a fundamental concept in economics that explains why countries or individuals engage in trade To explain this concept to some... View the full answer