One country has a comparative advantage over another country in the production of a good if it
A) has a curved production possibilities curve and the other country has a linear production possibilities curve.
B) has a linear production possibilities curve and the other country has a curved production possibilities curve.
C) is a lower opportunity cost producer of the good.
D) has lower fixed costs than the other country.

Question

Quizplus · Accepted Answer

Comparative advantage is determined by which country has a lower opportunity cost in producing a good. In other words, which country has to sacrifice fewer resources or give up fewer alternative production options to produce a certain good. Therefore, option C is the correct answer as it directly relates to the concept of comparative advantage.

One Country Has a Comparative Advantage Over Another Country in the Production