| Main Entry: | absolute advantage |
| Part of Speech: | n |
| Definition: | a business situation in which a provider of goods or services is more profitable or efficient than all of its competitors, by having a smaller total input per unit of output |
| Usage: | business |
Absolute Advantage
The ability of a country, individual, company, or region to produce a good or service at a lower cost per unit than the cost at which any other entity produces that good or service.
Investopedia Commentary
Those entities with absolute advantages can produce something using a smaller number of inputs than another party producing the same product.
Related Links
Economics Basics Tutorial
See also: Comparative Advantage, Eating Someone's Lunch, Eclectic Paradigm, Productivity