If two people are producing two different products with different opportunity costs, would a higher relative price on one product make both producers go for that one product?
In economics, the concept of comparative advantage is used to determine the products to be produced and the products to be outsourced. It is governed by the opportunity cost, which in turn is the net gain associated with the second-best alternative forsaken by an individual or a firm.
Answer and Explanation: 1
If two people are producing two different products with different opportunity costs, one may use the concept of comparative advantage to prioritize...
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fromChapter 57 / Lesson 3
A comparative advantages is the ability to produce goods at a lower cost than an opponent. Learn how this relates to absolute advantages and leads to specialization of production and exchange of the surplus products.