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Differences Between the Theories of Absolute and Comparative Advantage

Essay Instructions:

Please do not use APA. Thanks.
Please answer the following. Do not remove the numbering sequence. Thanks. 
Describe the differences between the theories of absolute and comparative advantage. What were the shortcomings of these theories?
Using the absolute advantage theory: Do trade flows relate to a country’s specific economic and social characteristics?
3. Conduct external research and find the U.S. BOP (Table 4.1A), then answer the questions below:
1. What do you observe about the current account over time?
2. Are U.S. exports greater or less than U.S. imports?
3. Do services improve the merchandise import and export balance?
Where is foreign exchange markets located? Where are the main centers of foreign trading?
4.Please list and briefly describe the major international trade organizations.
Give an example of international bank or international financial institution and describe how it works in international business.
5.Briefly discuss how local environment and international business can influence each other.
Define culture in your own words and discuss how culture influences local business and international business. Note: even your own words require external "cited" source support.
6. What are some of the basic issues a company must consider when choosing their marketing strategy for a new foreign market? Explain your answer from a functional operations perspective.
Please illustrate how capital budgeting for international projects differs from domestic projects. 
7. How does the scope of a firm’s internationalization affect its HRM practices?
Describe the various control mechanisms MNCs can use in International business
8. Define “Ethics in International Business?” Then after you provide a description with supportive literature, tell us in your own words, “Is it possible for International Managers to exercise ethics in International business?” Why or why not?
Based on background reading, media, , what are your thoughts about future trends of international business?

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Absolute advantage is the condition where a country can produce certain goods at a lower cost compared to another one while comparative advantage refers to the situation in which a given country produces particular goods at a lower opportunity cost when compared to other countries (Louis & Kurtz, 129). Hence, a country has an absolute advantage over another one if it can produce more goods when same resources are availed to both. Comparative advantage means that a country can produce certain goods better than another one.
Both theories are limited in their application because they are applicable where there are two countries and two goods. The principles do not apply for larger numbers of countries and commodities,
1. The U.S. current account deficit has been on the rise.
2. The number of imports to the U.S. are more than the exports.
3. Services improve the merchandise import and export balance because both goods and services are exported and imported.
Foreign exchange market are decentralized and exist where a currency is exchanged for another one. There is, therefore, no central location for the market. The main centers for forex trading are located in the member countries.
4. (a) World Trade Organization (WTO) deals with rules among the member countries to ensure that trade flows smoothly among the members.
(b) United Nations Conference on Trade and Development (UNCTAD) is involved in trade and investment among the United Nations members.
(c) World Customs Organization (WCO) enhances the efficiency of customs through harmonization and standardization.
International Monetary Fund (IMF) promotes exchange stability among the member countries. It also facilitates the growth of the international business by helping in the creation of a multilateral system for the payment of current transactions.
5. International business has to follow the local regulations to avoid fines due to non-compliance. The local environment affects the cost of running the business and how the international business can market and the products and services. On the other hand, international business shapes the local environment by influencing the decision-making process on resource use.
Dinkin, Filner & Maxwell, 79 define culture as the accepted norms and values of a particular group. It refers to the way things are done in a particular place. A local busi...
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