Question

If a nation is more productive than a trading partner, can it still gain from trade with that partner? Use the concepts of absolute and comparative advantage to explain.

Answer 1

productive depends on how you use this term, if productive means that the nation is able to produce at a lower opportunity cost than the trading partner( comparative advantage) than it should trade with the trading partner and should import the good in which he is less productive,

if a nation due to its resources is able to produce goods more than that of trading partner than it will be profitable if it importds good from the trading partner which is able to produce at relatively lower opportunity cost than the nation itself,

so it is the comparative advantage that matters not the absolute advantage.