Question

Comparative Advantage (Adam Smith) is:

(a) The ability of a country to produce a good at a lower opportunity cost than any other country.
(b) The ability of a country to produce more of a good than any other country.
(c) The ability of a country to produce a good with fewer resources than any other country.
(d) None of the above.

Answer 1

Comparative Advantage, as defined by Adam Smith, is the ability of a country to produce a good at a lower opportunity cost than any other country.

Step-by-step explanation:

Comparative Advantage, as defined by Adam Smith, is the ability of a country to produce a good at a lower opportunity cost than any other country. This means that a country can produce a good more efficiently, using fewer resources, than other countries. It is a concept that encourages countries to specialize in the production of goods in which they have a comparative advantage, and then trade those goods for things in which other countries have a comparative advantage, resulting in increased global production and higher levels of consumption.