Comparative And Absolute Advantages

Comparative and Absolute AdvantagesComparative Advantage is when a country , a person , a group , a line of descent first step or a firm can bring onward a computable at a lesser prospect terms than the competing firmFor example , there are two companies some(prenominal) selling turn and cell phones .

The first simplyiance is US Cell telephones and habiliment Corporation is of course locate in the bog country , America , where technology is very updated and materials for do clothes is much developed and is plentiful the second company is the Indian Technology and musical mode Incorporated , in which we all know that India is not that updated in technology which is essential in making first class cell phones , but they take up t lack the knowledge on the modern fashion regarding clothes its design and its materials to be exercised for an excellent quality of clothingThe Indian Technology and Fashion Incorporated should lay out a big sum of money for them to acquire employees , employers and also to hire intelligent clear uprs of their products whereas the US Cell Phones and Clothing Corporation use up only a less amount to fall down up wit the same produceThe US Cell Phones and Clothing Corporation has a comparative advantage with Cell Phone production , it must think carefully about having only Cell phone while the Indian Technology and Fashion Incorporated should give up the Cell phone business and just concentrate on their product in which it is the last(a) unfavor open condition , which is the ClothingAbsolute Advantage is state when the country , a person , a group , a business enterprisingness or a firm has the quality of being able to bring forth a good or execute a service at a lower cost than the price of the competing firm that also yields out the certain good . It is also the ability of a firm to produce a certain good only by utilizing lesser materials than their competing firmFor typeface , the Philippines can produce more products in formal suits than about countries in the Southeast Asia . It is because Philippines has efficient or lots of resources to make it than any other Southeast Asian Country . So , Philippines is said to have an absolute advantage in this areaReferenceEconomics . bare-assed Standard Encyclopedia . Pages 38-41 . Volume 6PAGEPAGE 1...If you want to get a full essay, order it on our website: Ordercustompaper.com

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