International Trade Simulation
Introduction
International trade is important because it provides people with more selection of goods and services to choose from. Free trade between countries not only encourages economic growth and freedom, it also promotes innovation and competition in the market. Sometimes trade restrictions are imposed because dumping of goods from other countries occurs, or where free trade may hamper the growth of a developing industry. This stimulation also covers the theory of comparative advantage, the impact of quotas, tariff, and dumping, and the reasoning behind free trade agreements (FTAs).
Opportunity Costs and Comparative Advantage
Comparative advantage is dynamic and can change over time. Factors like improvements in technology, investment in research and development, change in quantity or quality of product, inflation, or import restrictions (tariffs and quotas) can change the comparative advantage of a country in comparison with another.
A country should specialize in......
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Approximate Word Count: 830
Approximate Pages: 4 (250 words per double-spaced page)
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