The nation of Hasalot is home to roughly 95% of the world's Diamontite, a rare stone used in consumer products including watch faces, smartphones, computer monitors, and tablets. The fact that this is necessary for the production of many products we use today means Hasalot can almost name its price! Which of the following describes this situation?

A. Hasalot's rare earth industry participates in monopolistic competition.

B. Hasalot has a near absolute advantage in Diamontite.

C. Hasalot's rare earth industry is considered perfect competition.

D. Hasalot has a comparative advantage in Diamontite

In the case above, Hasalot is said to have an absolute advantage according to the situation that has been described. It has an absolute advantage in the case that the resources it has, is not possessed by any one else in the entire world.

Since other countries also want this resource for their production, the other countries will be ready to pay the price that is asked for by this country because there is no other alternative or substitute available with any other country. This puts Hasalot in the situation of absolute advantage.

Baraq Baraq · Answer 2 · 2021-10-26T14:51:16+02:00

Considering the situation described in the question, the statement that describes this situation is "Hasalot has a near-absolute advantage in Diamontite."

This is based on the idea that an absolute advantage in business production is the capacity of a firm or company to produce a product or offer services at a rate that is greater than the competitors using the same amount of input and time or producing the same amount but with lesser input.

In this case, since Hasalot can produce more than any other competitors since they have 95% of the world's raw materials, this is considered a near-absolute advantage.

Hence, in this case, it is concluded that the correct answer is option B. "Hasalot has a near absolute advantage in Diamontite."

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