A country has a comparative advantage in a good if
A) It can produce more of the good than another country.
B) It can produce a good at a lower opportunity cost relative to another country.
C) It can specialize only in two goods.
D) It also has an absolute advantage in the production of the good.

Question

Quizplus · Accepted Answer

A country has a comparative advantage in a good if it can produce that good at a lower opportunity cost relative to another country. This means that the country can produce one good at a lower cost (in terms of foregone production of another good) compared to other countries, making it more efficient in producing that good than other countries.

A Country Has a Comparative Advantage in a Good If