Theories of International Trade
Abstract
Absolute Advantage in individual level - exists when a person can produce more of a certain good/service than someone else in the same amount of time (or can produce a good using the least amount of resources). In national level, absolute advantage exists when a country can produce more of a good/service than another country can in the same time period. Comparative Advantage is a person or a nation has a comparative advantage in the production of a product when it can produce the product at a lower domestic opportunity cost than can a trading partner.