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suppose there are several countries that are efficient at producing coffee beans and brazil is one of those countries. while brazil is efficient at producing coffee beans, it is inefficient at producing electronics. because of this, brazil sells its coffee beans to other countries and buys electronics from other countries. this scenario exemplifies the concept of

Respuesta :

Because of this, brazil sells its coffee beans to other countries and buys electronics from other countries. this scenario exemplifies the concept of Comparative Advantage.

Comparative Advantage :

The ability to create a good or service at a reduced opportunity cost is a benefit of comparative advantage. A comparative advantage allows businesses to sell goods and services at lower prices than competitors, resulting in higher sales margins and more profitability.

How do you determine comparative advantage?

When a country provides a good or service with the lowest opportunity cost, it is considered to have a comparative advantage. In a comparative advantage situation, opportunity cost is the loss of one good when creating the other.

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