Companies in Country A can produce computers at a lower cost.
For example, Brazil has an absolute advantage over the United States in the production of coffee; the nations of the Middle East have an absolute advantage over the United States in the production of crude oil.
When a nation can use fewer resources to produce the same amount of a product, it has an absolute advantage in the production of that product.
Country x has an absolute advantage when it can produce corn at a lower cost than country y.
Its production costs for clothing were the lowest in the world.
When its production costs are lower.
For example, Brazil has an absolute advantage over the United States in the production of coffee; the nations of the Middle East have an absolute advantage over the United States in the production of crude oil.
When a nation can use fewer resources to produce the same amount of a product, it has an absolute advantage in the production of that product.
Country x has an absolute advantage when it can produce corn at a lower cost than country y.
Its production costs for clothing were the lowest in the world.
When its production costs are lower.
absolute cost advantage talks about the efficiency and cheaply a country incure in the production of goods and services against other country whiles comparative advantage talks about the opotunity cost of goods
Absolute advantage and comparative advantage are two basic concepts to international trade. Under absolute advantage, one country can produce more output per unit of productive input than another. With comparative advantage, if one country has an absolute (dis)advantage in every type of output, the other might benefit from specializing in and exporting those products, if any exist.A country has an absolute advantage economically over another, in a particular good, when it can produce that good at a lower cost. Using the same input of resources a country with an absolute advantage will have greater output. Assuming this one good is the only item in the market, beneficial trade is impossible. An absolute advantage is one where trade is not mutually beneficial, as opposed to a comparative advantage where trade is mutually beneficial.A country has a comparative advantage in the production of a good if it can produce that good at a lower opportunity cost relative to another country. The theory of comparative advantage explains why it can be beneficial for two parties (countries, regions, individuals and so on) to trade if one has a lower relative cost of producing some good. What matters is not the absolute cost of production but the opportunity cost, which measures how much production of one good, is reduced to produce one more unit of the other good.
Yes, since each country can individually specialize in its comparative advantage, the total income for both countries will increase. This is even true if one country has an absolute advantage in the production of all goods.
what are the assumptions of the absolute advantage cost?
When a country has an absolute advantage in production of that good it may specialize in producing that good.
The Production Budget for Absolute Power was $50,000,000.
Country X can manufacture cars more cheaply.