The principle of Comparative Advantage o Differences in the cost of production determines the following Who should produce what How much should be trade for each product Who can produce potatoes at a lower cost? The farmer or the rancher?The Principle of Comparative Advantage • Differences in the cost of production determines the following: – Who should produce what – How much should be trade for each product • Who can produce potatoes at a lower cost? The farmer or the rancher?