Country A's exports to Country B amount to $200 billion, which is 25 % of A's total exports. A diplomatic dispute forces A to choose between two options:

(i) impose sanctions that cut trade with B by 60 % and raise the security‑alliance rating by 15 points;
(ii) negotiate a compromise that cuts trade with B by 20 % and raise the rating by 5 points.

The government will adopt the option that maximises the weighted score
$S = 0.7 \times (\text{percentage of total exports retained}) + 0.3 \times (\text{rating increase})$.

Which option should be chosen?

Question

Country A's exports to Country B amount to $200 billion, which is 25 % of A's total exports. A diplomatic dispute forces A to choose between two options:

(i) impose sanctions that cut trade with B by 60 % and raise the security‑alliance rating by 15 points;
(ii) negotiate a compromise that cuts trade with B by 20 % and raise the rating by 5 points.

The government will adopt the option that maximises the weighted score  
$S = 0.7 \times (\text{percentage of total exports retained}) + 0.3 \times (\text{rating increase})$.

Which option should be chosen?

Accepted Answer

The compromise option (20 % trade reduction, 5‑point rating increase)

Gce Model Questions Vol1 2019 Government Question 22

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