Which of the following statements shows how absolute advantage can be distinguished from comparative advantage? I. Absolute advantage refers to the ability to produce a good using fewer inputs, while comparative advantage is based on the monthly amount. II. Absolute advantage is based on the yearly production amount that a country can produce, while comparative advantage is based on the monthly production amount. III. Absolute advantage refers to the ability to produce a larger amount of goods with the same number of inputs, whereas comparative advantage refers to the ability to have the lowest opportunity cost of production.
A) I and III only
B) II and III only
C) I, II, and III
D) III only

Question

Quizplus · Accepted Answer

Absolute advantage is about producing more with the same inputs, while comparative advantage is about having the lowest opportunity cost.

Which of the Following Statements Shows How Absolute Advantage Can