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Describe the concept of international conparative advantage and explain how it relates to international capital flows,intl le
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1) A country enjoys comparative advantage in the production of a good if that good can be produced at a lower cost in terms of other goods . When a country has comparative advantage in one good in international market , then the country can specialize in that good and engage in trade . Trading according to comparative advantage provide certain gains and helps a country to consume at a point beyond it production possibility frontier . This is possible because each country if specializes in the good in which they have comparative advantage then total production rises in world market and each country gets the share of this benefit . Rise in production of a particular good and gains from trade increases national income and growth , this attracts foreign investors and capital . So international trade also helps to channelize foreign capital into the economy which aids in further growth .

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