ECN 204 Lecture Notes - Lecture 10: Opportunity Cost, Fallacy, Comparative Advantage
11 Apr 2017
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17. 5- analyze the validity of the most frequently presented arguments for protectionism. Volume: exports are about 28% of canadian gdp, imports are about 29% of canadian gdp. Trade patterns: a trade surplus occurs when exports exceed imports. Canada had a trade surplus in goods in 2014: a trade deficit occurs when imports exceed exports. Canada had a trade deficit in services in 2014: canada imports some of the same categories of goods that it exports, called intra-industry trade, canada"s export and import trade is mainly with other industrially advanced nations. Efficient production requires different technologies or resource combinations. Products are differentiated as to quality and other non-price attributes. A country is said to have absolute advantage over other producers for a product if it is the most efficient producer of that product. A country is said to have a comparative advantage over other producers of a product if it can produce the product at a lower opportunity cost.
