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4 September, 17:02

Country A would have an absolute advantage compared to Country B in the production of corn if

A) corn can be produced at lower cost in terms of other goods than it could be in Country B.

B) Country A uses fewer resources to produce corn than Country B does.

C) the demand for corn is higher in Country A than in Country B.

D) corn sells for a higher price in Country A than in Country B.

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  1. 4 September, 18:29
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    B) Country A uses fewer resources to produce corn than Country B does.

    Explanation:

    An absolute advantage is a situation where a country or a company can produce some goods and services using fewer inputs compared to competitors. The company can produce more quantity of using the same amount of inputs than others. A country with an absolute advantage will manufacture a product at a lower cost than other countries or companies.

    Absolute advantage enables companies and countries to gain from trade. Through specialization, a company will focus on what it can produce at a lower cost than others, and sell it. Country A has an absolute advantage if it can produce corn at a lower cost than country B.
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