Tuesday, September 15, 2009

How to Teach Comparative Advantage in AP Economics

Summary:

A short video showing how to use the "output/over" method to compute the comparative advantage in AP Macroeconomics and AP Microeconomics.




A difficult concept for students to learn is comparative advantage. Students have to learn how to calculate the relative cost as measured in opportunity cost between two production alternatives. After showing the students how to use a production possibilities curve and calculate the opportunity cost, I often show the output over method. The video will make clear how to calculate the opportunity cost of good X in terms of good Y when comparing "how much" two individuals can make. For the teacher who wants an in-depth explanation, I recommend Activity 6, Lesson 3 in the Advanced Placement Economics workbook. This activity is also available on the Virtual Economics CD-ROM. This compilation has every lesson on economics available for immediate printing. I use Virtual Economics in my law class too.

The beauty of teaching comparative advantage is that students can apply the concept in either macro or microeconomics. Students get a huge "bang for the buck" when they learn this concept.

If you have other suggestions on how to teach this concept, please leave comments.
video

About the Author: Mike Fladlien is an AP Economics teacher from Muscatine High School in Muscatine, IA. He is an EconEdLink.org author, and also publishes the Mikeroeconomics and iMacroeconomics VB blogs.

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