Question

The karakul is a breed of Central Asian sheep that produces curly, glossy wool. This wool is popular in some countries for the manufacturing of warm hats and coats. Since the breed can only be grown in Central Asia, this region can be said to have a(n)______________.a. absolute advantageb. economy of scalec. advantageous distinctiond. total advantagee. comparative advantage

Answer 1

Answer:

The correct answer is letter "A": absolute advantage.

Explanation:

An Absolute Advantage is a person, company, or country's ability to produce a good or service at a lower cost than any competitor would. An organization with an absolute advantage requires fewer inputs and/or has more efficient processes that allow its product to be sold at a lower price than its rivals, and earn higher profits.

Answer 2

Answer: a. absolute advantage

Explanation:

Absolute advantage is a principle in Economics in which a business enjoys the advantage of producing higher number of goods and services than their competitors even when they use the same amount of input or resources. This grant such producer low marginal cost, cheap materials, workers, etc.

This concept was developed by Adam Smith in his 1776 publication titled The wealth of Nations.