Which of the Following Is an Example of Absolute Advantage

question 15

Multiple Choice

Which of the following is an example of absolute advantage?

• A)Japan makes cars more efficiently than the United States.
• B)Germany makes cars more efficiently than the United States,and the United States makes software more efficiently than Germany.
• C)The United States is likely to win in a trade war against either Germany or Japan.
• D)Japan makes cars more efficiently than any other country.
• E)All countries are equally efficient at making software.

---

Definitions:

Utility

A term in economics that refers to the total satisfaction received from consuming a good or service.

Satisfaction

The fulfillment of one's wishes, expectations, or needs, or the pleasure derived from this fulfillment.

Consumer

A person or collective who buys products or services for their own consumption.

Diminishing Marginal Utility

The principle that as a person consumes more of a product, there is a decline in the additional satisfaction or utility that person derives from consuming one more unit of the product.