The Principle of Comparative Advantage States That Total Output Is

question 2

Short Answer

The principle of comparative advantage states that total output is greatest when each product is made by the country that has the ____________.

---

Definitions:

Imported Good

A product or service that is brought into one country from another to be sold.

Consumer Surplus

The difference between the maximum price a consumer is willing to pay for a product and the actual price they do pay.

Specific Tariff

A specific tariff is a fixed fee imposed by a government on each unit of imported or exported goods, rather than a percentage of their value.

Loss

A situation where expenses exceed revenues, resulting in negative financial performance.