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= = == =Specialization and Interdependence=

Specialization occurs when producers provide a limited number of goods or services

 * The development of International Trade enables a nation to specialize in the production of goods and services that can be traded for other products

What happens without International Trade?

 * A nation can only consume the goods and services it produces

**The factors of production: Natural, Human, Capital, Entrepreneurial**

 * They are not distributed equally throughout the world
 * This uneven resource distribution encourages nations to trade in order to improve their citizen's standard of living
 * Absolute Advantage: the ability of a nation, region, or company to produce a certain good or service more efficiently and cheaply than any other nation, region, or company
 * Comparative Advantage: the ability of a nation, region, or company to produce a certain good or service more cheaply than any other country