Question

The productivity gains achieved by specialization are due to A. comparative advantage. B. lower opportunity costs from switching production from one good to another. C. scarcity. D. absolute advantage.

Answer 1

The correct answer is letter "A": comparative advantage.

Step-by-step explanation:

Comparative Advantage is an individual, business, or country's ability to produce a good or service at a lower cost of opportunity than its competitor. Getting a comparative advantage does not mean that one organization is completely better at producing a good or a service than another. It implies that it sacrifices less to do so. Comparative advantage allows firms to specialize in the manufacturing of the goods or services being produced at a lower cost.

Answer 2

Comparative advantage.

Step-by-step explanation:

Comparative advantage is the ability to produce good and services at a lower opportunity cost compared to others , leading to lower selling price and competitive advantage over others .

Specialization is about concentrating on producing a few products in order to

build brands , expertise and gain maximum productivity leading to a reduction in selling price and a comparative advantage.