Question

A(n) _________ advantage is a monopoly that exists when a country is the only source of an item, the only producer of an item, or the most efficient producer of an item while a(n) ________ advantage is when a country specializes in products that it can supply more efficiently or at a lower cost than it can produce other items.

Answer 1

Answer:

1) an absolute advantage is a monopoly..........................

2) a comparative advantage is when a country ......................

Explanation:

Lets consider the USA and SAUDI ARABIA as a case study and the products has OIL and CORN:

Saudi arabia has more advantage in poducing oil because of the vast natural resource of oil, human work force and technology which they have in abundance than the USA which is an absolute advantage while the USA also have vast vegetative land which can also produce corn in abundance which is also an absolute andvantage to the USA.

while comparing both advantages saudi also has the land to produce corn but not as much as the USA does so they wont want to monopolise on it in other to exchange for corn with the USA at lower cost and vice versa.