Whenever a nation has a lower opportunity cost of producing any good
Or service in relative terms, that nation is said to have:
A)an absolute advantage.
B)a comparative advantage.
C)low labor costs.
D)better technology to produce that good or service.

Question

Quizplus · Accepted Answer

A nation with a lower opportunity cost of producing a good or service in relative terms has a comparative advantage in producing that good or service. This means that the nation can produce the good or service at a lower cost (in terms of other goods or services they forgo producing) compared to other nations, making it more efficient and competitive in the world market. The other answer choices (A, C, and D) may contribute to a nation having a comparative advantage but are not the defining characteristic of it.

Whenever a Nation Has a Lower Opportunity Cost of Producing