Is it possible to have a comparative advantage in the production of a good but not to have an absolute advantage? Explain.

Absolute advantage refers to the ability of one country or producer to produce a particular good or service more efficiently than another country or producer. In other words, it's the ability to produce more of a good or service using the same amount of resources, or to produce the same amount of a good or service using fewer resources.

Comparative advantage, on the other hand, is a concept that relates to the opportunity cost of producing a good or service. It shows that a country or producer can have an advantage in producing a good or service even if they are not the most efficient in producing that item. A country or producer has a comparative advantage in producing a good or service if they can produce it at a lower opportunity cost than another country or producer.

Let's use an example with two countries, A and B, and two goods, apples and oranges, to demonstrate the possibility of having a comparative advantage without an absolute advantage. Suppose the production of goods in both countries is as follows: - Country A: 10 apples or 15 oranges per day - Country B: 20 apples or 30 oranges per day In this case, Country B has an absolute advantage in the production of both goods, as they can produce more apples and oranges per day than Country A using the same resources. Now let's calculate the opportunity costs: - Country A: 1 apple costs 1.5 oranges | 1 orange costs 2/3 apples - Country B: 1 apple costs 1.5 oranges | 1 orange costs 2/3 apples Despite Country B having an absolute advantage, both countries have the same opportunity costs for producing apples and oranges. This means that neither has a comparative advantage over the other in producing either good.

It is possible for a country or producer to have a comparative advantage in the production of a good without having an absolute advantage. Comparative advantage is determined by opportunity cost, which means that a country may be able to produce a particular good at a lower opportunity cost than another country even if they cannot produce it more efficiently (i.e., they do not have an absolute advantage).