Specialization and Exchange - Chapter 2 vocab
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Last updated 7:05 PM on 12/16/22
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6 Terms
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**production possibilities frontier (PPF)**
a line or curve that shows all the possible combinations of two outputs that can be produced using all available resources
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**efficient points**
combinations of production possibilities that squeeze the most output possible from all available resources
3
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**absolute advantage**
the ability to produce more of a good or service than others can with a given amount of resources
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**comparative advantage**
the ability to produce a good or service at a lower opportunity cost than others
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**specialization**
spending all of your time producing a particular good
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**gains from trade**
the improvement in outcomes that occurs when producers specialize and exchange goods and services
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