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JAMB Economics 2005 Question 43

Question 43

International Trade

Use the table below to answer the question.
Country | Groundnuts(unit) | Cocoa (units)
Nigeria | 8,000 | 1,000
Ghana | 1,000 | 8,000
Total production | 9,000 | 9,000
The difference in each country's total output on specialization is

  1. A.16,000 units
  2. B.9,000 units
  3. C.8,000 units
  4. D.7,000 units
Show the answer and explanation

Answer: D (7,000 units)

Explanation

With specialisation Nigeria makes 16,000 groundnuts (and Ghana 16,000 cocoa), against 9,000 of each before: a gain of 16,000 − 9,000 = 7,000 units.