Comparative advantage can be determined by abundance of factor endowments.

Question

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Comparative advantage is determined by the abundance of factor endowments. Countries that have an abundance of a particular factor such as natural resources, technology, or skilled labor have a comparative advantage in producing goods or services that use that factor intensively. This allows them to produce those goods or services at a lower opportunity cost than other countries, giving them a competitive advantage.

Comparative Advantage Can Be Determined by Abundance of Factor Endowments