AP Macroeconomics: Unit 1 – Module 4: Comparative Advantage And Trade – Flashcards
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_____ provides goods and services to others and receives goods and services in return.
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Trade
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_____ is when people can get more of what they want through trade than they could if they tried to be self-sufficient. It arrises from _____.
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Gains from Trade, specialization
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_____ is a situation in which people engage in a different task that he or she is good at performing.
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Specialization
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The production possibilities curve model is useful for illustrating gains from trade: trade based on _____.
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Comparative advantage
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_____ is when the opportunity cost is lower for the individual than for the other people.
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Comparative Advantage
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People are willing to trade if the "price" of the good each person is obtaining from trade is _____ than his opportunity cost of producing the good himself.
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less
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As long as people have different _____, everyone has a comparative advantage in something, and a comparative disadvantage in something.
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opportunity cost
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_____ is when an individual can make more of a good or service with a given amount of time and resources.
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Absolute Advantage
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are what allow someone to specialize in their respective fields
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Markets
