What do you          Answer this question in at 
         know?                 least 4 sentences:
    Can you define these 
    terms?               If you can produce everything 
    •
    Advantage
    •
    Absolute               you need, why would you 
    •
    Goods
    •
    Services
    •
    Balance of trade                 trade?
    •
    Balance of payments
    •
    Specialization 
    •
    Deficit
    •
    Surplus
      BY THE END OF          Essential Questions
     THIS LESSON YOU  How do a nation’s limited resources affect its decision to engage in 
     SHOULD KNOW…. international trade? 
                             Why do specialization and trade lead to increased efficiencies, 
                             production, consumption, and satisfaction? 
    Terms                    How does the use of comparative advantage increase gains from 
                             trade for two or more nations? 
    Content Terms
    •                        In what ways have you personally benefitted from gains from trade?
    Balance of Trade
    •
    Balance of Payment
    •
    Absolute Advantage
    •
    Comparative Advantage    Georgia Performance Standard
    •
    Trade Deficit
                             SSEIN1 The student will explain why individuals, businesses, and governments 
    •
    Trade Surplus            trade goods and services. 
                             a. Define and distinguish between absolute advantage and comparative advantage. 
                             b. Explain that most trade takes place because of comparative advantage in the production of a 
    Academic Terms           good or service. 
                             c. Explain the difference between balance of trade and balance of payments. 
    •
    Distinguish
    •
    Specialize               Literacy Standards
                             RH.11-12.3 Analyze a complete set of ideas or sequence of events and explain how 
                             specific individuals, ideas, or events interact and develop over the course of the text.
                             RH.11-12.7 Integrate and evaluate multiple sources of information presented in 
                             different media or formats as well as in words in order to address a question or solve a 
                             problem.
                             WH.11-12.1 Write arguments to support claims in an analysis of substantive topics or 
                             text using valid reasoning and relevant and sufficient evidence.
    As a class, brainstorm possible answers to the 
               question:
              Why do 
          countries trade?
                           Countries trade because…
                                       •      they cannot produce a product 
    Specialize- a task                        domestically.
    assigned to one 
    person or group                    •      to have a wider variety of goods 
    that does it more 
    efficiently                               available to consumers.
                                       •      even if a they can produce a 
                                              product, if another country 
                                              specializes it that item, buying it 
                                              from them may increase quality 
                                              and decrease the price.
                                       •      they wish to conserve limited 
                                              resources.
                                       •      other countries have an 
                                              advantage.
                  Type of Advantage
                     There are 2 types of 
                     advantage.
                     •
                     Absolute Advantage
                     •
                     Comparative Advantage 
                                             Advantage- a 
                                             condition or 
                                             circumstance that 
                                             puts one in a 
                                             favorable position