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Basic Economic Concepts

Basic Economic Concepts

Basic Economic Concepts

  • How do increasing opportunity costs affect the shape of the production possibilities curve? Provide an example that illustrates the concept of increasing opportunity costs. Include a graph or illustration to support your answer. Your response should be at least 75 words (1 paragraph) in length, plus the graph or illustration.
  • Assume country A has an absolute advantage in producing all products compared to country B but country B has a comparative advantage in producing several products. Are there opportunities for gains from trade? If so, what determines the direction of trade? Your response should be at least 75 words (1 paragraph) in length.
  • Explain how international trade allows a country to move beyond its production possibilities frontier and create gains from trade. Your response should be at least 75 words (1 paragraph) in length.

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