Comparative advantage and absolute advantage are the two
concepts used during the international trade.
Comparative advantage refers to the ability of a country to
produce goods and services at a lower opportunity cost than other
competitive countries.
While absolute advantage refers to the ability of a country to
produce goods and services more efficiently than other countries by
using minimum resources to produce them.
When comparative advantage is used, we compare two countries in
terms of the how much productive they are while absolute advantage
is used to compare two countries in terms of being more productive
than the other.
Firms that have absolute advantage will be able to produce
goods and services with minimum resources than other firm's while
firms that have comparative advantage will be able to produce goods
and services with lower cost.