the table above shows the maximum amount of trucks or coffee that china and malaysia can produce using the same amount of resources. based on the data provided, which of the following terms of trade are mutually beneficial for the two countries?

The mutually beneficial terms of trade are: 1 ton of coffee for 4 trucks.

Why this is the right answer

From the data (often presented in the original table):

• China can produce 250 trucks or 50 tons of coffee with the same resources.
  • Opportunity cost of 1 ton of coffee for China = 250/50=5250/50=5250/50=5 trucks.

• Malaysia can produce 300 trucks or 100 tons of coffee.
  • Opportunity cost of 1 ton of coffee for Malaysia = 300/100=3300/100=3300/100=3 trucks.

For a terms of trade to be mutually beneficial , the “price” of 1 ton of coffee in terms of trucks must lie between the two opportunity costs:

• More than 3 trucks (so Malaysia gets more than it could by producing trucks itself).

• Fewer than 5 trucks (so China gives up fewer trucks than it would if it produced the coffee itself).

So any terms of trade between 3 and 5 trucks per ton of coffee benefit both countries.

Among the options you quoted:

• 1 ton of coffee for 3 trucks → equal to Malaysia’s opportunity cost, not strictly beneficial for both.

• 1 ton of coffee for 4 trucks → between 3 and 5, so mutually beneficial.

• 1 ton of coffee for 5 trucks → equal to China’s opportunity cost, not mutually beneficial.

• 1 truck for 1 ton of coffee or 1 truck for 5 tons of coffee → outside the mutually beneficial range.

So the correct choice is “1 ton of coffee for 4 trucks.”

Information gathered from public forums or data available on the internet and portrayed here.