Comparative Advantage vs. Absolute Advantage It is also important to understand how comparative adva

Comparative Advantage vs. Absolute Advantage It is also important to understand how comparative advantage differs from absolute advantage, another very important economic concept. Absolute Advantage  Absolute advantage refers to when a party can produce more of a good or service with the same amount of resources than another party.  For instance, if country A is able to manufacture 100 tons of wheat with the same resources for which country B can make only 50 tons, then it means that there is an absolute advantage of producing wheat for country A.  Absolute advantage emphasizes the broader productivity and resource use regarding the production of a specific good. Comparative Advantage  Comparative advantage is actually the cost of producing another good more than the first due to another producer.  A party may have an absolute advantage in producing both goods, but it will still benefit from specializing in the good for which its opportunity cost is lower and trading