What term describes a situation where a country or individual can produce a good at a lower opportunity cost than others?

The term that describes a situation where a country or individual can produce a good at a lower opportunity cost than others is comparative advantage. This concept is crucial in international trade and economics, as it highlights the benefits of specialization and trade.

When a country has a comparative advantage in producing a particular good, it means that the country sacrifices less in terms of other goods when it allocates resources to produce that good. This principle encourages countries to specialize in the production of goods where they hold a comparative advantage, allowing for more efficient resource allocation and increased total production.

By trading, countries can benefit from each other's strengths, leading to a more optimal distribution of resources and enhanced overall economic welfare. In contrast, absolute advantage refers to the ability to produce more of a good with the same resources or to produce the same amount of a good with fewer resources, which does not account for opportunity costs in the same way that comparative advantage does. Competitive edge and resource allocation, while relevant in different contexts, do not define the specific relationship of opportunity costs in production that comparative advantage does.