An economy is said to have a comparative advantage in the production of one good if it:
A)can produce more of all goods than another economy.
B)can produce less of all goods than another economy.
C)has the highest opportunity cost of producing a particular good.
D)has the lowest opportunity cost of producing a particular good.

Question

Quizplus · Accepted Answer

Comparative advantage is the ability of an economy to produce a particular good at a lower opportunity cost than another economy. Therefore, an economy has a comparative advantage in the production of a particular good if it has the lowest opportunity cost of producing that good. Thus, option D is the correct answer.

An Economy Is Said to Have a Comparative Advantage in the Production