The advantage to the nation.
Explanation of Solution
The international trade is the exchange of goods and services between different nations in the world. The exchange will take place and the main two processes are the export and imports. The exports is the sale of domestic goods to the foreigners and imports is the vice versa.
When the domestic price of the good is lower than the international price of the commodity, it means that the
Concept introduction:
International trade: It is the trade relation between the countries.
Export: It is the process of selling the domestic goods in the international market. Thus, the goods produced in the domestic firms will be sold to other foreign countries. So, it is the outflow of domestic goods and services to the foreign economy.
Import: It is the process of purchasing the foreign made goods and services by the domestic country. Thus, it is the inflow of foreign goods and services to the domestic economy.
Comparative advantage: It is the ability of the country to produce the goods and services at lower opportunity costs than the other countries.
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Principles of Macroeconomics (MindTap Course List)
- Economics Today and Tomorrow, Student EditionEconomicsISBN:9780078747663Author:McGraw-HillPublisher:Glencoe/McGraw-Hill School Pub Co
- Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning