Occurs when a country has a monopoly on producing a product or is able to produce it at a cost well below that of all other countries.

Multiple Choice

o

Dumping advantage

o

Complete advantage

o

Comparative advantage

o

Absolute advantage

Absolute advantage

Explanation:

A country has an absolute advantage if it can produce good and services at lower costs than others. Absolute advantage occurs when a country produces a higher quantity of goods using the same inputs as other nations. It also refers to a situation where a country produces the same quantity of products but a lower cost.

Absolute advantage is the foundation of international trade. A country that specializes in producing products it has an absolute advantage in can offer them to the market at a lower price. It exports those products to other countries.