Asked by
Tanuj Loshali
on Dec 08, 2024
Verified
Country A has a comparative advantage compared to Country B in the production of shoes if
A) Country A can produce shoes at a lower monetary cost than Country B can.
B) Country A can produce shoes using fewer resources than Country B can.
C) the demand for shoes is higher in Country A than in Country B.
D) Country A can produce shoes at a lower cost in terms of other goods than Country B can.
Comparative Advantage
A principle that states a country should produce goods and services at a lower opportunity cost than its trade partners.
Monetary Cost
The total amount of money that is spent in order to purchase goods or services.
Resources
Inputs or assets used in the production of goods and services, including labor, capital, and natural materials.
- Understand the theory of comparative and absolute advantage in international trade.
- Apply the principles of opportunity cost and comparative advantage to real-world scenarios.
Verified Answer
AG
Learning Objectives
- Understand the theory of comparative and absolute advantage in international trade.
- Apply the principles of opportunity cost and comparative advantage to real-world scenarios.