Question

Are differences in geography behind the differences in absolute advantages?

Short answer

yes

Step-by-step solution

Step 1. Definition

Absolute advantage refers to the ability of a person, firm, or region to produce a product at a comparatively lower cost or to produce more output at the same cost.

Step 2. Explanation 

Differences in geography can be one of the sources of absolute advantage. Because of different geographical features such as climate, and resources availability. etc. it can be possible for a country to produce a good at a lower cost. For instance, the abundance of oil reserves in Saudi Arabia contributes to its absolute advantage in oil production. Similarly, Guatemala has an appropriate climate for coffee production, thus it enjoys an absolute advantage.