Economics (AS & A Level) · Feb / March 2024 · Paper 12 · Question 24

The table indicates the factor inputs required to produce wheat and cars in countries X and Y. | | units of factor inputs to produce one tonne of wheat | units of factor inputs to produce one car | |---|---|---| | country X | 4 | 2 | | country Y | 8 | 6 | What makes it possible for both countries to benefit from trade?

1. ACountry X has an absolute advantage in wheat and car production.
2. BCountry Y has an absolute advantage in wheat and car production.
3. CCountry Y has a comparative advantage in wheat production.
4. DOpportunity cost of wheat and car production is the same between countries.

As printed in the paper