compad - The Gains from Trade Why do people specialize in...

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Comparative slide 1 The Gains from Trade The Gains from Trade Why do people specialize in the production of a few goods or services and then trade? Why don't people become self-sufficient instead, producing everything they need?
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Comparative slide 2 An Example Suppose there are two people, McPherson and Brown. Both can produce Tacos and Spaghetti, but they are not equally adept.
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Comparative slide 3 McPherson's Daily Production Possibilities tacos spaghetti 10 5
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Comparative slide 4 McPherson has preferences that make him want to consume 4 tacos and 2 spaghetti. [Show his consumption point on the graph.]
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Comparative slide 5 McPherson's Daily Production Possibilities tacos spaghetti 10 5 He consumes 4 tacos and 2 spaghetti
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Comparative slide 6 Brown's Daily Production Possibilities tacos spaghetti 10 5 12 12 Brown McPherson
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slide 7 Suppose that Brown consumes 5 spaghetti and 7 tacos. [Show his consumption point on the graph.]
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compad - The Gains from Trade Why do people specialize in...

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