Question

question
individuals or firms experience the highest gains from trade when each limits their work to producing what they can make at a lower opportunity cost than the other producers. this ability to make a good at a lower opportunity cost than another producer is known as
select an answer
○ a. trade.
○ b. absolute advantage.
○ c. specialization.
○ d. comparative advantage.

Explanation:

The question defines the ability to produce a good at a lower opportunity cost than another producer. This is the core definition of comparative advantage. Absolute advantage refers to higher productivity, specialization is focusing on one good, and trade is the exchange of goods—none match the given definition.

Answer:

D. comparative advantage.