What is the primary benefit of having an absolute advantage in the production of a good?

• A. The producer is guaranteed to benefit from trade with others.
• B. The producer can produce more of the good using the same amount of resources compared to others.
• C. The producer can consume more of all goods without trading.
• D. The producer can produce the good at a lower opportunity cost than others.

Answer: (B)

Verified step by step guidance

1. Step 1: Understand the concept of absolute advantage. Absolute advantage occurs when a producer can produce more output of a good using the same amount of resources compared to another producer.
2. Step 2: Recognize that absolute advantage focuses on the productivity or efficiency in producing a good, not on the opportunity cost or trade benefits.
3. Step 3: Differentiate absolute advantage from comparative advantage, which is about producing at a lower opportunity cost, not necessarily producing more output.
4. Step 4: Identify that having an absolute advantage means the producer can produce a greater quantity of the good with the same inputs, which is a direct measure of productivity.
5. Step 5: Conclude that the primary benefit of having an absolute advantage is the ability to produce more of the good using the same resources, rather than guaranteed trade benefits or consuming more without trade.