[ECON 1000] - Midterm Exam Guide - Comprehensive Notes for the exam (141 pages long!)

• School: Carleton University
• Department: Economics
• Course: ECON 1000
• Professor: Nick Rowe

Document Summary

Reasons for trade: economies of scale the more you do something, the more productive you are (specialize) David ricardo ricardo"s difficult idea , early 1800s: 2 countries: canada & the us, 2 goods: apples & bananas considering printing. Comparative advantage over the us in producing apples: us has comparative advantage in bananas. People gain from trade b/c people are different. Reasons for trade: economies of scale the more you do something, the more productive you are (specialize, adam smith the wealth of. Nations, 1776: comparative advantage, david ricardo ricardo"s difficult idea , early 1800s, 2 countries: canada & the us, 2 goods: apples & bananas considering printing. Assume you are a small business owner and are a marketing brochure. While 500 brochures will cost you per brochure, 2,500 will only cost you per brochure. In this case, the printer is passing on part of the cost advantage of printing a larger number of brochures to you.