Refer to the information provided in Table 33.5 below to answer the question(s) that follow. Cashews are measured in bushels and tea is measured in pounds (lbs.)
Table 33.5
-Refer to Table 33.5. The most that India will be willing to pay for a lb. of tea is
A) 1/10 of a bushel of cashews.
B) 1/5 of a bushel of cashews.
C) 1/4 of a bushel of cashews.
D) 1/2 of a bushel of cashews.

Question

Refer to the information provided in Table 33.5 below to answer the question(s) that follow. Cashews are measured in bushels and tea is measured in pounds (lbs.)
Table 33.5 
-Refer to Table 33.5. The most that India will be willing to pay for a lb. of tea is
A) 1/10 of a bushel of cashews. 
B) 1/5 of a bushel of cashews. 
C) 1/4 of a bushel of cashews. 
D) 1/2 of a bushel of cashews.

Quizplus · Accepted Answer

India is willing to trade a maximum of 2 million pounds of tea for 400,000 bushels of cashews. Therefore, the exchange rate is 5 pounds of tea for 1 bushel of cashews (2 million ÷ 400,000 = 5). To find out how much India is willing to pay for a pound of tea, we need to divide the price of a bushel of cashews by 5 (since 1 bushel is equivalent to 5 pounds of tea). The price of a bushel of cashews is highest in Vietnam, which is $120. Therefore, India is willing to pay a maximum of $24 for a pound of tea (120 ÷ 5 = 24). Among the answer choices, only B is close to $24, as 1/5 of $120 is $24.

Refer to the Information Provided in Table 33