The situation where a country can produce a good at a lower opportunity cost than another country is called a(n)__________ advantage.
A) permanent
B) transitory
C) absolute
D) comparative
E) natural

Question

Quizplus · Accepted Answer

When a country can produce a good at a lower opportunity cost than another country, it has a comparative advantage. This means it can produce the good more efficiently and cost-effectively, allowing it to specialize in producing that good and trade with other countries for goods it does not produce as efficiently. Absolute advantage refers to a country being able to produce more of a good with the same resources as another country, while natural advantage is a broad term used to refer to a country's overall resource endowments and geographic location. Permanent and transitory are not relevant terms in this context.

The Situation Where a Country Can Produce a Good at a Lower