1.2 PPC and Favorable Terms of Trade
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5 Terms
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Comparative advantage
when you have the lowest opportunity cost (giving up the least to produce what you’re producing)
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Absolute advantage
producing more of something within a given amount of time and resources
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Output method
OOO (output other over)
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Input method
IOU (input other # under)
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Mutually Beneficial Terms of Trade
the MBTT for a good falls between the producer’s OC and the buyer’s OC
indicates the rate at which one good can be exchanged for another
Note 
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