If you're seeing this message, it means we're having trouble loading external resources on our website. Show If you're behind a web filter, please make sure that the domains *.kastatic.org and *.kasandbox.org are unblocked. How do you calculate absolute advantage and comparative advantage?Make a table like Table 19.6.. To calculate absolute advantage, look at the larger of the numbers for each product. ... . To calculate comparative advantage, find the opportunity cost of producing one barrel of oil in both countries.. What is absolute advantage example?Absolute advantage is where a nation is more efficient at making a product than another. In other words, it requires fewer resources to make a final good or service. For instance, Brazil has an absolute advantage in making coffee beans.
How do you calculate comparative advantage?In country X, the opportunity cost, or the comparative advantage, of good A is 110 / 100 = 1.1 good B. The opportunity cost of good B in Country X is 100 / 110 = 0.91 good A. In country Y, the opportunity cost, or the comparative advantage, of good A is 80 / 90 = 0.89 good B.
What does it mean for a nation to have an absolute advantage in the production of a good Mcq?What does it mean for a nation to have an absolute advantage in the production of a good? It can produce the good more efficiently than another nation. It takes more raw materials than another nation to produce the good. It can produce the good at a lower opportunity cost than another nation.
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Absolute advantage and comparative advantage worksheet answer key
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