Comparative advantage theory

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Describe unequivocally why the foundation of trade has nothing to do with absolute advantage and only the law of comparative advantage is relevant.

Is not free trade good for two countries even if one of them has an absolute advantage (in terms of low costs and productivity) in all goods and services produced?

Reference no: EM1375437

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Comparative advantage theory : Describe unequivocally why the foundation of trade has nothing to do with absolute advantage and only law of comparative advantage is relevant.

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