Answer
Absolute advantage is the ability to produce a good using fewer inputs than another producer.
Comparative advantage is the ability to produce a good at a lower opportunity cost than another producer.
Work Step by Step
Economists use the term absolute advantage when comparing the productivity of one person, firm, or nation to that of another. The producer that requires a smaller quantity of inputs to produce a good is said to have an absolute advantage in producing that good.
On the other hand, economists use the term comparative advantage when describing the opportunity cost of two producers. The producer who gives up less of other goods to produce Good X has the smaller opportunity cost of producing Good X and is said to have a comparative advantage in producing it.
