Which of these is the basis of international trade?

A) Absolute advantage
B) Comparative advantage
C) Both comparative advantage and absolute advantage
D) Neither comparative advantage nor absolute advantage

Comparative advantage is the principle that states that countries should specialize in producing the goods or services that they can produce at a lower opportunity cost (i.e., sacrificing fewer resources) than other countries. It is the basis of international trade because it allows countries to maximize their overall output and efficiency by focusing on what they do best and exchanging their surplus goods and services with other countries. Absolute advantage, on the other hand, refers to a country's ability to produce a certain good with fewer inputs than another country, but it does not necessarily lead to international trade unless there are other factors involved.