An economy is said to have a comparative advantage in producing a particular good if it:
A) can produce more of all goods than another economy.
B) can produce less of all goods than another economy.
C) has the highest cost for producing that good.
D) has the lowest cost for producing that good.

Question

Quizplus · Accepted Answer

An economy has a comparative advantage in producing a particular good if it has a lower opportunity cost of producing that good compared to other economies. This means it has the lowest cost for producing that good, hence option D is correct.

An Economy Is Said to Have a Comparative Advantage in Producing