Does potassium hydroxide absorb carbon dioxide?

Potassium hydroxide absorbs rapidly carbon dioxide and water from air.
http://chemicalland21.com/industrialchem/inorganic/KOH.htm

Readily absorbs water and carbon dioxide from the air.
http://physchem.ox.ac.uk/MSDS/PO/potassium_hydroxide.html

very definetly.

Carbon dioxide forms a weak acid when it dissolves in water, carbonic acid:

CO2 + H2O -> H2CO3

This then combines with potassium hydroxide in an acid/base reaction:

H2CO3 + KOH -> KHCO3 + H2O

The result is potassium bicarbonate and water. When a solution of KOH is used in titrations, it must be titrated itself to determine its exact concentration. This is because it is constantly absorbing CO2 and loosing its strength as a base.

carbon dioxide is a acidic oxide .KOH is a strong alkali.therefore there should be a acid base reaction causing dissolution of or absorbtion of carbon dioxide.

Yes. The Apollo spacecraft used cannisters filled with KOH to remove the carbon dioxide from the air.

KOH + CO2 --> KHCO3 + K2CO3 +H2O

yes
2KOH + CO2 = K2 CO3 + H2O
do the balancing urself