The theory of comparative advantage states that a commodity should be produced in that nation where the

The theory of comparative advantage states that a commodity should be produced in that nation where the opportunity cost is least. Opportunity cost is the cost of choosing one alternative over the other. In other words, it is the cost of forgoing the benefits of the next best alternative. So, a country should specialize in producing goods and services that it can produce at a lower opportunity cost than other countries. By doing so, it can trade with other countries and get access to goods and services that it cannot produce efficiently. Therefore, the theory of comparative advantage suggests that countries should focus on producing goods and services that they can produce most efficiently, rather than focusing on producing all goods and services themselves.