Two organic farms, Greenacre and Meadowview, use all of their land and resources to produce either kale or strawberries. Greenacre can produce a maximum of 120 kg of kale120\text{ kg of kale}120 kg of kale or 40 kg of strawberries40\text{ kg of strawberries}40 kg of strawberries per day. Meadowview can produce a maximum of 90 kg of kale90\text{ kg of kale}90 kg of kale or 45 kg of strawberries45\text{ kg of strawberries}45 kg of strawberries per day.
Assuming constant opportunity costs, which of the following rates of exchange (terms of trade) for 1 kg of strawberries1\text{ kg of strawberries}1 kg of strawberries would allow both farms to benefit from specialisation and trade?
1.8 kg of kale1.8\text{ kg of kale}1.8 kg of kale
2.5 kg of kale2.5\text{ kg of kale}2.5 kg of kale
3.2 kg of kale3.2\text{ kg of kale}3.2 kg of kale
4.0 kg of kale4.0\text{ kg of kale}4.0 kg of kale
35 exam-style questions on OCR A Level Economics Specialisation and trade. Each one has a worked solution and a mark scheme showing where the marks go.