What is comparative advantage based on?
Comparative advantage, economic theory, first developed by 19th-century British economist David Ricardo, that attributed the cause and benefits of international trade to the differences in the relative opportunity costs (costs in terms of other goods given up) of producing the same commodities among countries.
Which statement best explains comparative advantage?
Which of the following statements best describes the theory of comparative advantage? Each nation should produce those goods that it can produce more efficiently and effectively than other nations, and buy the goods it cannot produce efficiently from other nations.
What is comparative advantage quizlet?
Comparative advantage is the ability of an individual, firm or country to produce a good or service at a lower opportunity cost then competitors. comparative advantage in production.
Which of the following is a source of comparative advantage quizlet?
Among the main sources of comparative advantage are the following: A. climate and natural resources, relative abundance of labor and capital, technology, external diseconomies.
Which situation is an example of comparative?
Answer Expert Verified The situation that is an example of comparative advantage is “a country decides to create goods at half the cost of another country”. Comparative advantage is an economic law referring to the ability of a country to produce goods and services at a lower opportunity cost than other countries.
What is the concept of opportunity cost quizlet?
Opportunity Cost is when in making a decision the value of the best alternative is lost. e.g. choosing electricity over gas, the opportunity cost is what you’ve lost from not picking gas. Choosing more of one thing which can only be achieved by giving up something else in exchange. You just studied 6 terms!
Which of the following best describes the meaning of opportunity cost?
Opportunity cost is used to describe the value that is given up by choosing an alternative option when faced with choices.
Which of the following best describes the idea of opportunity cost?
Opportunity cost is the value of the best alternative not chosen as it represents the benefit of the next best alternative to the activity chosen. Your Answer:The dollar value of tuition, books, room and board, and all associated explicit expenses.
Which situation best describes an opportunity cost Brainly?
Explanation: Opportunity cost is the cost of the forgone alternative when a choice is made. In this case, the store made a choice between buying a ship of computers, or buying new phones. It cannot do both because the firm has limited resources.
Which situation best describes an opportunity cost answers com?
Opportunity cost is defined as the cost of any activity measured in terms of the best alternative activity which is forgone. For instance, if you’re choosing between 4 stocks, chose stock 1 and all 4 stocks go up, but stock 3 rises the most, you measure your opportunity cost against ONLY stock 3.
What is a common advantage of a long term investment?
Explanation: Long-term investment refers to investment instrument such as bonds, stocks, real estate and so on that matures after many years. Long-term investment are also assets that can be held for more than a year.
At which level of production does the company make the most profit?
The correct answer is: “the fourth pair of cleats”. The higher the price charged, or the larger the quantity sold, the bigger the profits will be.
Which are affected by the factor of production?
Define “factors of production”: The resources that are used to make goods and services; land, labor, and capital.