A country will have a comparative disadvantage in goods whose production:
A) uses its relatively abundant resource.
B) has a higher wage rate than the other country.
C) is not in high demand relative to other countries products.
D) intensively uses its relatively scarce factor of production.
E) is in low demand in the global market.

Question

Quizplus · Accepted Answer

A country will have a comparative disadvantage in goods whose production intensively uses its relatively scarce factor of production. This is because the country would not be able to produce these goods as efficiently or cost-effectively as countries that have an abundance of the required resources. Comparative advantage and disadvantage are concepts from international trade theory, primarily based on the distribution of resources and their efficient utilization.

A Country Will Have a Comparative Disadvantage in Goods Whose