TheBusinessProfessor, Author at TheBusinessProfessor

Production Possibilities Frontier and Comparative Advantage

by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy

How does the Production Possibilities Frontier reflect Comparative Advantage? Absolute advantage simply compares the productivity of a worker between countries. It answers the question, “How many inputs do I need to produce shoes in Mexico?” Comparative advantage asks...

Absolute Advantage in All Goods

by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy

What is Absolute Advantage in All Goods? What happens to the possibilities for trade if one country has an absolute advantage in everything? This is typical for high-income countries that often have well-educated workers, technologically advanced equipment, and the...

Trade Surplus or Trade Deficit – Which is Better?

by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy

Is it better to have a trade surplus or a trade deficit? Because flows of trade always involve flows of financial payments, flows of international trade are actually the same as flows of international financial capital. The question of whether trade deficits or...

Income Payments – Economics

by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy

What are Income Payments? Income payments on assets, as the name implies, is income resulting from ownership of assets – including, interest, dividends, rents, royalties, etc. The third component of the current account balance, labeled “income payments,” refers...

Trade Balance vs Trade Surplus

by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy

Is a Trade Balance or Trade Surplus Better? Because flows of trade always involve flows of financial payments, flows of international trade are actually the same as flows of international financial capital. The question of whether trade deficits or surpluses are good...

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