Final answer:
Competitive advantage is the ability of an organization to produce goods or services more efficiently and effectively, giving it an edge over competitors. This includes leveraging comparative advantage, which implies producing at a lower opportunity cost and being adaptable in intra-industry trade settings.
Step-by-step explanation:
The ability of one organization to outperform other organizations because it produces desired goods or services more efficiently and effectively than its competitors is defined as a competitive advantage. Organizations strive to gain a competitive advantage to increase their market share and profits by finding ways to produce products more cheaply or to create products with attributes that consumers desire. A facet of competitive advantage can be seen in the concept of comparative advantage, where an organization or country can produce a good at a lower opportunity cost than others, allowing trade to be beneficial.
In the context of intra-industry trade, comparative advantage does not remain static but is dynamic and can evolve over time. Factors such as specialized learning, economies of scale, and innovation drive this change. Organizations or countries that adapt and cultivate new comparative advantages can maintain or increase their competitive advantage.