WHATS YOUR OPINION/THOUGTHS ON THIS DISCUSSION

Trade is an important part of maintaining thriving economies across different nations. A country has an absolute advantage for a good or service when it can produce more of that specific good or service than any other country can in the market. This means the country is the most efficient producer of a good or service. A country has a comparative advantage when it has the lowest opportunity cost for a specific good or service compared to the other countries in the market. This means the country forgoes the least amount of output alternatives to produce the desired good or service (McConnel et all., 2021). Trade is beneficial even when one entity has an absolute advantage in both tasks. This is because that entity an export more of that good or service to other countries that can't produce as much of it, therefore producing profit. This helps both the nation exporting by making them money, and the nation purchasing them as they receive the utility from those goods and services. It is also beneficial if the entity does not have the comparative advantage, and therefore importing goods from other entities would preserve their efficiency in obtaining both goods rather than only being able to produce one good at a time for full production. Fair trade terms are determined by comparing opportunity costs. Fair trading should enable both parties to achieve goods and services to push them beyond their production possibilities curve (PPC). This is important because without trade and all else equal, an entity has no way of producing more of a good than that determined by the values of the PPC. When working at Panera bread, my co-workers and I had to close the restaurant at nighttime. I had the absolute advantage of cleaning the bathrooms. I was not as efficient with washing and drying the dishes, so I had a higher opportunity cost when I was put on dishes. However, Adam was more efficient at doing dishes and had a lower opportunity cost to doing dishes than his opportunity cost for cleaning the bathrooms. Since I was assigned to dish that night, Adam and I decided to trade roles so that I could clean bathrooms and he could do dishes. That way was both performed the task which had a lower opportunity cost for us and more efficiently closed the restaurant.