Learning Objectives. Specialization occurs in different industries for different reasons. International specialization means that different countries of the world specialize in producing different goods. ... Why do business specialize? Learn that differences in autarky prices (terms of trade) coupled with the profit-seeking motive and the absence of transportation costs induce international trade. Reduced dependence on your local market. d. Is it possible for specialization and trade to increase total output of traded goods? Here are seven reasons for international trade: 1. What are most organisations broken into? c. How are the gains from trade shared among the parties to a trade? This is just one of the reasons AIU offers specialization tracks within the information technology degree program to help ensure the courses you take while completing your degree can help you prepare for the various challenges and possibilities of the job market. Larger outputs of both products become available to both nations. “The effects of specialization is such a broad concept that it touches upon almost everything in our daily life. D) the difference in resource endowments throughout the world. One of those questions is a. Do specialization and trade benefit more than one party to a trade? Is it absolute advantage or comparative advantage that really matters? B) higher trade restrictions imposed by a national government. Society and businesses cannot know everything and therefore need specialists with practical experience to help and guide us.” International trade - International trade - Simplified theory of comparative advantage: For clarity of exposition, the theory of comparative advantage is usually first outlined as though only two countries and only two commodities were involved, although the principles are by no means limited to such cases. international trade also discussed. It results in saving of money for the company because due to specialization company does not have to incur expenses on training because if worker is moved from one job to another then he or she needs to be trained for doing a task but in case of specialization since worker is not moving anywhere there is no need to train him or her. Specialization, along with the complementary concept of the division of labor, occurs when the innate inequalities of human productive output … Specialization allows people to produce the best product or service. International trade is an activity of strategies importance in the development process of a developing economy. 2.9 The Motivation for International Trade and Specialization. Specialization according to comparative advantage results in a more efficient allocation of world resources. The Trans-Pacific Partnership (TPP) was negotiated between the United States and 11 other countries—all of which border the Pacific—and it aimed to enhanced trade and investment among the TPP partner countries. C) diminishing returns to a variable factor of production. And our natural urge for specialization is also one of the main reasons why professional services exist.  The countries involved were Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. Trade policy b. Businesses specialize in producing one type of good or service. In this way, they can use capital and labour efficiently. One reason for international specialization is _____ A) a high world price for a good. The TPP included new trade … The outcome of international specialization and trade is equivalent to a nation having more and/or better resources or discovering improved production techniques. _____ a ) a high world price for a good a nation more. 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