Question

    In the context of comparative advantage, what does the

    term 'opportunity cost' refer to?
    A The absolute cost of producing a good Correct Answer Incorrect Answer
    B The potential benefit that is lost when choosing one alternative over another Correct Answer Incorrect Answer
    C The financial expense incurred in producing a good Correct Answer Incorrect Answer
    D The total resources required to produce a good Correct Answer Incorrect Answer

    Solution

    Opportunity cost refers to the potential benefit that is lost when one alternative is chosen over another. In the context of comparative advantage, it measures the cost of forgoing the production of one good in order to produce another good.

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