After reading this chapter, you should be able to:

• Demonstrate opportunity cost with a production possibility curve.
• Relate the concept of comparative advantage to the production possibility curve.
• State the principle of increasing marginal opportunity cost.
• State how, through comparative advantage and trade, countries can consume beyond their production possibilities.
• Explain how outsourcing is part of a global process guided by the law of one price.
• State six roles of government.
• Compare the regulation of international markets to the regulation of domestic markets.