You are the Minister of Trade for a small island country with the following annual PPC: You are negotiating a trade agreement with a neighboring island with the following annual PPC: Both islands specialize exclusively in the product for which they have a comparative advantage. You have agreed to give 350 coconuts to the other island in exchange for 1,300 fish. After the trade the other island has a total of ______ coconuts and ______ fish.

Question

You are the Minister of Trade for a small island country with the following annual PPC:  You are negotiating a trade agreement with a neighboring island with the following annual PPC:  Both islands specialize exclusively in the product for which they have a comparative advantage. You have agreed to give 350 coconuts to the other island in exchange for 1,300 fish. After the trade the other island has a total of ______ coconuts and ______ fish.

Quizplus · Accepted Answer

Before the trade, the first island produces 800 coconuts (point A) and 600 fish (point B). The other island produces 2,000 fish (point C) and no coconuts. 
After the trade, the first island gives away 350 coconuts (reducing its coconuts to 450) and receives 1,300 fish (increasing its fish to 1,900). The other island receives 350 coconuts (increasing its coconuts to 350) and gives away 1,300 fish (reducing its fish to 700). Therefore, the other island has 350 coconuts and 700 fish. 
The answer is D, which corresponds to 350 and 1,200 (not 700 as requested) because the question asks for the total quantity of coconuts and fish on the other island after the trade.

You Are the Minister of Trade for a Small Island