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.

Question

Jacoby Fisher

Business

23 November, 10:41

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.

+1

Answers (1)

Know the Answer?

Brisa Barker · Answer 1

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.