Question

comparative and absolute advantage
what is the difference between comparative advantage and absolute advantage?
comparative advantage measures opportunity cost and absolute advantage measures efficiency.
absolute advantage measures opportunity cost and comparative advantage measures production cost.
comparative advantage measures sale price and absolute advantage measures production cost.
absolute advantage measures sale price and absolute advantage measures production cost.

Explanation:

Comparative advantage is based on opportunity - cost analysis, showing which entity has a lower opportunity cost to produce a good. Absolute advantage is about efficiency, meaning an entity can produce more of a good using the same amount of resources.

Answer:

A. Comparative advantage measures opportunity cost and absolute advantage measures efficiency.