What Does Absolute Advantage Mean

question 63

Multiple Choice

What does absolute advantage mean?  

• A) It means autarky. 
• B) It means that two countries of the same size have the same opportunity cost of producing two particular goods. 
• C) It means that one country can produce more of two goods than another country can. 
• D) It means that one country can produce less of two goods than another country can.

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Definitions:

Long Run

A period of time in economics sufficiently long to allow for all inputs to production, such as plant and equipment, to be varied (as opposed to just the amount of labor or raw materials).

Total Loss

A situation in insurance where the cost of repairing a damaged property exceeds the property's value, making it economically unfeasible to repair.

Total Loss

The complete financial loss of an asset's value, often in the context of insurance or investments.

Variable Cost

Costs that vary directly with the level of production or service delivery.