Examlex
Which of the following statements is correct?
Comparative Advantage
The capability of an entity to manufacture a product or provide a service at a reduced opportunity cost compared to its competitors.
Opportunity Cost
The cost of foregone alternatives, the value of the next best alternative that is given up when making a decision.
Comparative Advantage
The ability of a country or firm to produce a particular good or service at a lower opportunity cost than its competitors, leading to more efficient trade and production patterns.
Absolute Advantage
A situation in which a country, individual, or company can produce a particular good or service more efficiently than another party, using the same amount of resources.
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