Asked by Christina Ercolani on Apr 25, 2024

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In a two-nation world, comparative advantage in the production of a particular product means that one nation can produce

A) the product with fewer inputs than the other nation.
B) the product at lower average cost than the other nation.
C) the product at a lower domestic opportunity cost than the other nation.
D) more of the product than the other nation.

Domestic Opportunity Cost

The opportunity cost of producing goods domestically rather than importing them, measured by what is given up in the domestic production of other goods.

  • Understand the merits of dedicating resources to specialization and exchanging goods or services through comparative advantage.
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DW
DeAnna Williams7 days ago
Final Answer :
C
Explanation :
Comparative advantage refers to the ability of a country to produce a particular good or service at a lower opportunity cost than another country. Opportunity cost is the cost of a foregone alternative, which means that if one country can produce a good at a lower opportunity cost, it is more efficient than the other country. Therefore, choice C is the correct answer as it reflects the lower domestic opportunity cost of producing the particular product in one country.