Scribd Logo
Upload

Welcome to Scribd!

  • 46 views

    T7 - Answer Scheme Bop

    Uploaded by

    Akai Gunner
    Jordan has a comparative advantage in wheat production over Syria, who has a comparative advantage in rice production. After specialization, Jordan would produce 1,404 tonnes of wheat and Syria would produce 1,600 tonnes of rice. The total world output of both goods increases through specialization and trade.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    T7 - Answer Scheme Bop

    Uploaded by

    Akai Gunner
    46 views5 pages
    Jordan has a comparative advantage in wheat production over Syria, who has a comparative advantage in rice production. After specialization, Jordan would produce 1,404 tonnes of wheat and Syria would produce 1,600 tonnes of rice. The total world output of both goods increases through specialization and trade.

    Original Title

    T7 - ANSWER SCHEME BOP

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Jordan has a comparative advantage in wheat production over Syria, who has a comparative advantage in rice production. After specialization, Jordan would produce 1,404 tonnes of wheat and Syria would produce 1,600 tonnes of rice. The total world output of both goods increases through specialization and trade.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    46 views5 pages

    T7 - Answer Scheme Bop

    Uploaded by

    Akai Gunner
    Jordan has a comparative advantage in wheat production over Syria, who has a comparative advantage in rice production. After specialization, Jordan would produce 1,404 tonnes of wheat and Syria would produce 1,600 tonnes of rice. The total world output of both goods increases through specialization and trade.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    You are on page 1of 5

    ANSWER SCHEME

    SEPT 14(Q4)

    a)

    Country Rice (Tonne) Wheat (Tonne)


    Jordan 500 700
    Syria 800 600

    i. Calculate the comparative advantage of producing computer and rice for both countries and
    state the goods that each country should specialize in.

    Country Rice (Tonne) Wheat (Tonne)


    Jordan 700/500 = 1.4 500/700 = 0.71
    Syria 600/800 = 0.75 800/600 = 1.3
    - Jordan should specialize in producing of wheat and Syria should specialize in producing
    of rice.

    ii. Construct the table to show the amount of goods produced after specialization.

    Country Rice (Tonne) Wheat (Tonne)


    Jordan 0 700 + (500/0.71) = 1404
    Syria 800 + (600/0.75) = 1600 0
    TOTAL 1600 1404

    b)

    Year 2012 2013


    (RM million) (RM million)
    Overall balance 20250 -19889
    Reserve assets -20250 19889

    i) Does the overall balance shows a situation deficit or surplus for 2012 and 2013.
    Explain the effect on reserve asset for both year.
    = -19889 + 20250
    = RM 361 million (surplus)

    2012
    - BOP surplus. Reserve asset will increase.
    2013
    - BOP deficit. Reserve asset will decrease.
    NOTE:
    At the end BOP should be ZERO.
    When having a surplus, the extra will be deposited in reserve asset ( country
    will be richer). ) (20250 – 20250 = 0 (the (-) sign in reserve asset shows
    increase in reserve asset)
    When having a deficit, the shortage will be covered by withdrawing the reserve
    asset, resulted decrease in reserve asset and countries will be risked to
    international debt. ( - 19889 + 19889 = 0 (the (+) sign in reserve asset shows
    decrease in reserve asset)
    ANSWER SCHEME

    MARCH 16(Q4)

    ITEMS RM(MILLION)
    Freight and insurance -4250
    Other transportations 90
    Income from investment -5520
    Travel 650
    Other services 1550
    Exports 95750
    Imports 98230
    Private short term capital 3210
    Official long term capital 630
    Corporate investment 9250
    Transfer payments 350
    Errors and omissions 750

    Based on the above table, calculate:

    a) Balance of trade
    = Exports-Imports
    = 95750-98230
    = RM -2480 million
    b) Balance of services
    = 1550
    -4250 + 90 + 650 + 1550 = - 1960
    c) Current account balance
    = -2480 + (-4250+90+650) + 350 + (-5520) + 1550
    = RM 9610 million
    -2480 – 1960 + (-5520) + 350 = - 9610
    d) Capital account balance
    = capital account + financial account
    = 3210 + 630 + 9250
    = RM 13090 million

    e) Overall balance
    = -9610 + 13090 + 750
    = RM 4230 million
    ANSWER SCHEME

    March 17(Q4)

    ITEMS RM(MILLION)
    Freight and insurance -4255
    Other transportations 93
    Income from investment -5525
    Travel 655
    Other services 1550
    Exports 95750
    Imports 98230
    Private short term capital 3215
    Official long term capital 630
    Corporate investment 9200
    Transfer payments 350
    Errors and omissions 750

    a) Balance of current account


    = (95750-98230) + (-4255+93+655) + 350 + (-5525) + 1550
    = RM -9612

    b) Balance of capital and financial account


    = 3215 + 630 + 9200
    = RM 13045 million

    c) Overall balance
    = -9612 + 13045 + 750
    = RM 4183 million

    d) Surplus
    ANSWER SCHEME

    DEC18 (Q4)

    ITEMS RM(MILLION)
    Freight and insurance 2155
    Other transportations 98
    Income from investment 1525
    Travel 322
    Exports 32320
    Imports 33010
    Private short term capital 1710
    Official long term capital 315
    Corporate investment 4125
    Transfer payments 135
    Errors and omissions 323

    a) Balance of goods
    = 32320 – 33010
    = RM 690 million

    b) Balance of current account


    = -690 + (2155+98+322) + 135 +1525
    = RM 3545 million

    c) Balance of capital and financial account


    = 1710 + 315 + 4125
    = RM 6150 million

    d) Overall balance
    = 3545 + 6150 + 323
    = RM 10018 million

    e) Surplus
    ANSWER SCHEME

    June 19(Q4)

    Country Bananas (tons) Watermelon (tons)


    MM 700 850
    NN 800 900

    a) Which country has an absolute advantages in the production of bananas?


    - Country NN has advantage in the production because the number of production
    bananas is more than country MM by 100.

    b) Calculate the comparative advantage of producing both product.


    Country Bananas (tons) Watermelon (tons)
    MM 850/700 = 1.21 700/850 = 0.82
    NN 900/800 = 1.13 800/900 = 0.89

    c) Specify which country should specialize in the production bananas and watermelons.
    - Country NN should specialize in producing of bananas and country MM should
    specialize in producing of watermelons.

    d) Construct a table after specialization for both country and indicate the total world
    output.
    Country Bananas (tons) Watermelon (tons)
    MM 0 850 + (700/0.82) = 1704
    NN 800 + (900/1.13) = 1596 0
    TOTAL 1596 1704

    e) Suggest the possible term of trade that will benefit both countries.
    = (1.21 + 1.13)/2 = 1.17
    1 bananas = 1.17 watermelons

    OR

    = (0.82 + 0.89)/2 = 0.855


    1 watermelons = 0.855 bananas

    You might also like

    pFad - Phonifier reborn

    Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

    Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


    Alternative Proxies:

    Alternative Proxy

    pFad Proxy

    pFad v3 Proxy

    pFad v4 Proxy