Answer :
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1. Comparative advantage is the ability of a country, individual, or organization to produce goods or services at a lower opportunity cost than others. Opportunity cost refers to the value of the next best alternative foregone when a decision is made.
2. When it comes to the relationship between opportunity cost and comparative advantage, higher opportunity costs do not necessarily equal a greater comparative advantage. In fact, the opposite is true.
3. Lower opportunity costs indicate a greater comparative advantage. This is because lower opportunity costs mean that fewer resources are sacrificed to produce a good or service, making the production more efficient and cost-effective.
4. Therefore, the statement that higher opportunity costs equal a greater comparative advantage is false. In reality, lower opportunity costs lead to a greater comparative advantage.
In conclusion, in the context of comparative advantage, lower opportunity costs are associated with a greater comparative advantage, not higher opportunity costs. This principle highlights the importance of efficiency and resource allocation in determining comparative advantage.
1. Comparative advantage is the ability of a country, individual, or organization to produce goods or services at a lower opportunity cost than others. Opportunity cost refers to the value of the next best alternative foregone when a decision is made.
2. When it comes to the relationship between opportunity cost and comparative advantage, higher opportunity costs do not necessarily equal a greater comparative advantage. In fact, the opposite is true.
3. Lower opportunity costs indicate a greater comparative advantage. This is because lower opportunity costs mean that fewer resources are sacrificed to produce a good or service, making the production more efficient and cost-effective.
4. Therefore, the statement that higher opportunity costs equal a greater comparative advantage is false. In reality, lower opportunity costs lead to a greater comparative advantage.
In conclusion, in the context of comparative advantage, lower opportunity costs are associated with a greater comparative advantage, not higher opportunity costs. This principle highlights the importance of efficiency and resource allocation in determining comparative advantage.
