What is the difference between absolute advantage and comparative advantage? ▼ comparative absolute advantage is the ability of an individual, a firm, or a country to produce a good or service at a lower opportunity cost than competitors. while ▼ comparative absolute advantage is the ability of an individual, a firm, or a country to produce more of a good or service than competitors when using the same amount of resources.

Key Differences Between Absolute Advantage vs Comparative Advantage. .However, the concept of Comparative Advantage refers to the country's capability of producing the specific good at lower marginal cost and opportunity cost. Absolute advantage concept is based on lower marginal cost of production of a specific good.

Explanation:

Absolute Advantage is the inherent ability of a country that allows that country to produce specific goods in an efficient and effective manner at a relatively lower marginal cost. A country has an absolute advantage in producing a good if it can produce that good at lower marginal cost, lesser manpower, lesser time and lesser cost without compromising the quality. Comparative Advantage refers to the country’s capability of producing the specific good at lower marginal cost and opportunity cost in comparison to other countries. In absolute advantage where the emphasis is only on marginal cost, comparative advantage takes into account both marginal and opportunity cost.

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