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Chapter 3 Reflection

1. There several issues in the buy local argument. One issue is that even if the finished product was made down the street, many factors of production likely came from elsewhere, so it is not 100% locally made. Another issue is that if we did rely on only local producers, the markets would shrink and there would be less variety because it would take people longer to do things. Trying to shop 100% local means that you lose the benefits of specialization that come with global trade.

2. I will buy local when it gives me added value...for example, more convenience, a more creative or unique product, or better sustainability practices.

3. A strength of buying local that is not mentioned in the video is that transportation costs are lower because products do not have to travel as far. In turn, this has a smaller impact on the environment. Plus, it is easier to know what actually goes into the product since you could probably meet the person who is in charge of making it.

4. In one sense, trade with Wyoming is similar to trade with China since we choose to trade with those who have a lower opportunity cost in a certain area, thus enabling both of us to benefit. However, doing business with Wyoming will keep most of that money circulating in the USA. Also, there are now tariffs associated with China, which results in passing on deadweight losses to the consumers.

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