AA: A nation is said to have an absolute advantage if it requires fewer resources—generally raw materials, manpower or time—to produce a given item.
CA: Comparative advantage is all about reducing the opportunity cost of a given production strategy. The opportunity cost of producing a particular item is equal to the potential benefit that could have been gained by choosing an alternative. Assume that, utilizing the same amount of time and resources, China can produce either 30 computers or 45 cellphones.
