The Primary Flaw in the Theory of Absolute Advantage Is

question 112

Multiple Choice

The primary flaw in the theory of absolute advantage is that the theory ________.

• A) confuses the acquisition of treasure with the acquisition of wealth
• B) looks only at relative productivity differences rather than competitive differences
• C) suggests that no trade will occur when one country has an absolute advantage in multiple products
• D) incorporates the concept of opportunity cost in determining which goods a country should produce

---

Definitions:

Effectiveness

The degree to which objectives are achieved and the extent to which targeted problems are solved.

PR Disaster

A situation caused by negative public relations events that significantly harm an organization's or individual's reputation and public image.

Transparent

Characterized by openness, communication, and accountability, allowing others clear insight into the processes or information.

Settling

The process of resolving a dispute or legal case by mutual agreement between the parties involved, often without admitting guilt or liability.