Absolute Advantage Is Based on Opportunity Cost

question 194

True/False

Absolute advantage is based on opportunity cost.

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Definitions:

Average Total Costs

The sum of all production expenses (both fixed and variable) divided by the total quantity of units created.

Per-Unit Costs

The cost associated with producing or acquiring a single unit of a product or service.

Competitive Process

The dynamic system in which businesses compete with one another for resources, customers, and market share.

Cost Advantages

Refers to the benefit a company has over its competitors in terms of lower production or operation costs.