BackPPF - Comparative Advantage and Absolute Advantage definitions
You can tap to flip the card.
Control buttons has been changed to "navigation" mode.
1/15BackSkip to main contentBackProductivity
Level of output achieved with a given amount of resources, differing among individuals, firms, or countries. Production Possibility Schedule
Table or graph showing maximum combinations of two goods that can be produced with fixed resources and technology. Linear Production Possibility Schedule
Production possibility schedule where trade-offs between goods are constant, simplifying calculations and analysis. Fixed Technology
Assumption that methods and tools for production remain unchanged during analysis. Fixed Resources
Assumption that the quantity and quality of inputs used in production are constant. Specialization
Focusing production on goods for which an individual or entity is most efficient, increasing overall output. Absolute Advantage
Ability to produce more of a good using the same amount of resources compared to another producer. Comparative Advantage
Ability to produce a good at a lower opportunity cost than another producer, guiding efficient trade. Opportunity Cost
Amount of one good that must be given up to produce an additional unit of another good. Trade
Exchange of goods or services between parties, allowing each to benefit from specialization and comparative advantage. Maximum Output
Highest quantity of a good that can be produced when all resources are devoted to its production. Division Formula
Calculation method for opportunity cost, dividing maximum output of one good by maximum output of another. Production Possibility Curve
Graphical representation of all possible combinations of two goods that can be produced with fixed resources. Trade-Off
Sacrifice of one good in order to produce more of another, illustrated by movement along the production possibility curve. Efficiency
Achieving the highest possible output from available resources, often through specialization and trade.
Back
06:30
