Jack of All Trades: Benefits of Trade Online Module for Teachers and Students

In this module, students learn that economies can experience greater consumption through specialization and trade. However, the price must be right for trade to occur. So, students also ascertain the terms of trade, a condition where trade can only benefit both parties when the price of the good is higher than the exporter’s opportunity cost and lower than the importer’s opportunity cost.

Specifically, Jack and Andy work out the terms of trading potatoes and strawberries between their islands by comparing their opportunity costs of producing those goods.

Teachers:

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Education Level: 9-12 College
Subjects: AP Economics Economics
Concepts: Opportunity Cost Productivity
Resource Types: Online Module
Languages: English