How two parties can get better outcomes by specializing in their comparative advantage and trading
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Suppose that currently the United States produces 500 tons of shrimp and 1,000 tractors while Thailand produces 100 tons of shrimp and 1,500 tractors. Each country only consumes what it produces. Now assume that trade opens up between the two countries. If Thailand focuses on producing only shrimp, how many more tractors can be produced in total while keeping total shrimp production the same? answer is 1500 but hoooowww?
We assume 1 cup for 1 plate. However, what if market prices were different? What if we produced cars from one hand and eggs from the other hand? maybe every country would prefer to specialize in cars production, because they sell for a much higher price on the market. How do we take into account relative prices and so on?
Dude youtre amazing at explaining. I'm taking an online Macro course which I have to understand on my own. I found it a bit tricky because the given e-book doesn't really detail their explanations like you. Bravo!
you are awesome.... so clear and funny as well. It is a pleasure to learn from you. I go to a leading business school (top 3) for MBA. The MBA costs > USD 100,000 But our teachers suck. THE BEST THINGS IN LIFE ARE FREE :)
Excellent presentation. Take a look at a book on comparative advantage.
There are no gains from specialization only weaknesses when exploited you die or lose to someone who never specialized.
UK never specialized and easily conquered Gambia whose only product is Peanuts.
This is my theory of Comparative Advantage Trap in a peanut shell.
By not specializing in only what you are good at, you increase your purchasing power against someone else who specializes.
Food is 1/3rd of the US average household budget. If they didnt specialize...and grew their own food they would have that money to out bid others competitively for other goods.
Growing your own food takes time, effort and material resources like land and equipment. The opportunity cost of all of those things usually outweighs the financial benefits of not having to buy food. Have you ever known anyone to get rich by growing crops in their backyard?
How mean! First of they could have dyslexia, or maybe just made a typo. Why 'laugh out loud' at that and then question their intelligence? If they just can't spell, note that it doesn't take an intelligent person to know how to spell, it just requires having a good memory. I believe that you and your 9 amigos ought to be saddened for finding humour in belittling a 13 year old.
thanks for your wonderful lecture and i get so many information form your each Economic lecture and appreciate for your great job and hope that you will do more better in the future wish you all the best
Just how much does this Mr. Khan know? It's not like he's a jack of all trades but a master of none but he actually knows what he's talking about and, most importantly, he knows how to communicate that knowledge. Whatta bawss. (@[email protected])
Although foreigners may now invest in A-shares, there is a monthly 20 percent limit on repatriation of funds to foreign countries.
Performance of A-shares.
Since its inception in 1990, including a major reform in 2002, the index has seen great fluctuations. Overall, however, it has grown along with the Chinese economy. The years 2015 to 2016 were a particularly difficult period, with a 52-week performance of -21.55 percent as of July 20, 2016.
As China grows from an emerging market to an advanced economy, there is substantial demand for Chinese equity. Stock exchange regulators continue efforts to make A-shares more broadly available to foreign investors and have them recognized by the global investing community.
In June 2017, the MSCI Emerging Markets Index announced a long-awaited decision it would add stocks to its index. According to CNBC, MSCI will add 222 China A Large Cap stocks to its benchmark emerging markets index gradually beginning in 2018. The MSCI website reveals the stocks it will list include the Bank of China, China Merchants Bank, Guotai Junan, Ping An Insurance, according to a document on Tsingtao Brewery, SAIC Motor, Suning Commerce and Spring Airlines.
Current Dividend Preference.
Participating Preferred Stock.
Convertible Preferred Stock.
Cumulative preferred stock includes a provision that requires the company to pay preferred shareholders all dividends, including those that were omitted in the past, before the common shareholders are able to receive their dividend payments.
Non-cumulative preferred stock does not issue any omitted or unpaid dividends. If the company chooses not to pay dividends in any given year, the shareholders of the non-cumulative preferred stock have no right or power to claim such forgone dividends at any time in the future.
Participating preferred stock provides its shareholders with the right to be paid dividends in an amount equal to the generally specified rate of preferred dividends, plus an additional dividend based on a predetermined condition. This additional dividend is typically designed to be paid out only if the amount of dividends received by common shareholders is greater than a predetermined per-share amount. If the company is liquidated, participating preferred shareholders may also have the right to be paid back the purchasing price of the stock as well as a pro-rata share of remaining proceeds received by common shareholders.
Significance to Investors.