Title
(4) The PPF and Comparative Advantage
Topic Category
Production Possibilities Frontier
Publication Date
2010
Keywords
Production Possibilities Frontier, PPF, Comparative Advantage, Absolute Advantage, Gains from Trade
Abstract
The concept of comparative advantage is explained and contrasted with absolute advantage. Comparative advantage is shown to be the basis for mutual gains from exchange.
Recommended Citation
Crane, Steven E., "(4) The PPF and Comparative Advantage" (2010). Principles of Microeconomics. Paper 3.
http://epublications.marquette.edu/microecon_learning/3
Run Time
9:54
Primary Discipline
Microeconomics
Skills Delivered
Ability to Calculate Terms of Trade. Ability to identify Absolute and Comparative Advantage. Ability to determine who should specialize in what. Ability to demonstrate mutual gains from trade.
Rigor Level
2000
Prerequisites
Previous PPF Videos
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