The ability to produce an item at a lower opportunity cost compared with other producers is known as
A) competitive dominance.
B) productive dominance.
C) comparative advantage.
D) absolute advantage.

Question

Quizplus · Accepted Answer

The ability to produce an item at a lower opportunity cost compared with other producers is known as comparative advantage. This concept was first introduced by economist David Ricardo and forms the basis for international trade theory. Comparative advantage allows countries to specialize in the production of goods that they can produce most efficiently and trade with other countries for goods that they cannot produce as efficiently.

The Ability to Produce an Item at a Lower Opportunity