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4. Specialization and trade When a country has a comparative advantage in the production of a good, it means that it can produce this good

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4. Specialization and trade When a country has a comparative advantage in the production of a good, it means that it can produce this good at a lower opportunity cost than its trading partner. Then the country will specialize in the production of this good and trade it for other goods, The following graphs show the production possibilities frontiers (PPFs) for Canidonia and Sylvania. Both countries product lemans and sugar, each initially de, before specialization and trade) producing 16 million pounds of lemons and 9 million pounds of tugar, as indicated by the grey stars marked with the letter A Candona Sylvania 4 43 30 PPP 30 SUGAR ons of pounde und von 20 10 PR 1 40 34 33 LEMONS of sounds 15 LEMONS ( Mon of pounds) Candon has a comparata vantage in the production of while Sylvania has a comparative advantage in the production Suppose that Candonia and Sylvan speciale in the production of the goods in which each has mparative state atter specialization, the two countries can produce a total of bounds of mons and mi sounds of

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