Comparative advantage is
A) the ability to perform an activity at a zero opportunity cost.
B) identical to absolute advantage.
C) the ability to perform an activity at a higher opportunity cost than anyone else.
D) the ability to perform an activity at a lower opportunity cost than anyone else.

Question

Quizplus · Accepted Answer

Comparative advantage refers to the ability to produce a good or service at a lower opportunity cost than someone else. This means that even if one country or individual is better at producing all goods, there can still be a mutually beneficial trade if they focus on what they can produce at a lower opportunity cost than others. Therefore, choice D is the correct answer as it describes the concept of comparative advantage.

Comparative Advantage Is