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?

To determine mutually beneficial terms of trade between China and Malaysia for trucks and coffee, we follow these steps based on the production data and economic principles:

Step 1: Calculate Opportunity Costs for Each Country

• Opportunity cost of producing 1 truck = (maximum coffee production) / (maximum truck production)
• Opportunity cost of producing 1 coffee = (maximum truck production) / (maximum coffee production)

Calculate these for both China and Malaysia using the maximum outputs from the table (not provided here, but assumed known).

Step 2: Identify Comparative Advantage

• The country with the lower opportunity cost in producing trucks has the comparative advantage in trucks.
• The country with the lower opportunity cost in producing coffee has the comparative advantage in coffee.

Step 3: Determine the Range of Mutually Beneficial Terms of Trade

• The terms of trade (the exchange rate of trucks for coffee) must lie between the two countries' opportunity costs.
• For example, if China’s opportunity cost of 1 truck is 3 units of coffee and Malaysia’s opportunity cost of 1 truck is 5 units of coffee, then mutually beneficial trade terms would be between 3 and 5 units of coffee per truck.

Step 4: Select Terms of Trade Within This Range

• Any terms of trade that fall between the opportunity costs will make both countries better off than producing both goods independently.
• For instance, trading 1 truck for 4 units of coffee would be beneficial if it lies between the opportunity costs of the two countries.

Summary

• Mutually beneficial terms of trade must fall between the opportunity costs of the two countries for the goods traded.
• This ensures both countries gain by specializing in the good they produce at a lower opportunity cost and trading for the other good.
• Example: If China’s opportunity cost of 1 truck is 3 coffee and Malaysia’s is 5 coffee, then terms of trade such as 1 truck for 4 coffee are mutually beneficial

Without the exact production numbers from the table, the general rule is that the terms of trade must be set between the opportunity costs of producing trucks and coffee in China and Malaysia to ensure mutual benefit