CAT 2025 Slot 3 · DILR · Set 4: Trade Among Pumpland, Xiland and Cheeseland
The full set and all 5 questions (Q14–Q18) from CAT 2025 Slot 3, with answers and solutions.
Three countries — Pumpland (P), Xiland (X) and Cheeseland (C) — trade among themselves and with the (other countries in) Rest of World (ROW). All trade volumes are given in IC (international currency). The following terminology is used:
• Trade balance = Exports - Imports
• Total trade = Exports + Imports
• Normalized trade balance = Trade balance / Total trade, expressed in percentage terms
The following information is known.
1. The normalized trade balances of P, X and C are 0%, 10%, and -20%, respectively.
2. 40% of exports of X are to P. 22% of imports of P are from X.
3. 90% of exports of C are to P; 4% are to ROW.
4. 12% of exports of ROW are to X, 40% are to P.
5. The export volumes of P, in IC, to X and C are 600 and 1200, respectively. P is the only country that exports to C.
Question 14 · Caselet Based DI
How much is exported from C to X, in IC?
Answer & solution
Answer: 48
P is the only exporter to C, so C's imports = 1200.
C's normalized balance is −20%: (E − I) ÷ (E + I) = −0.2, so E − 1200 = −0.2(E + 1200), giving 1.2E = 960 and E = 800.
C exports 90% to P (720) and 4% to ROW (32), so the remaining 6% goes to X: 6% of 800 = 48.
Shortcut: a normalized balance of −20% means exports : imports = 0.8 : 1.2 = 2 : 3, so exports = 1200 × 2/3 = 800.
Hence, the answer is 48.
Question 15 · Caselet Based DI
How much is exported from P to ROW, in IC?
Answer & solution
Answer: 200
Let S = P's exports = 600 + 1200 + r, where r = P → ROW. P's balance is 0%, so P's imports also = S.
From fact 2: P's imports from X = 40% of X's exports = 22% of S, so X's exports E(X) = 0.55S.
X's balance is +10%, so X's imports = (9/11) × E(X) = 0.45S.
P's imports: from X (0.22S) + from C (720) + from ROW (40% of ROW's exports, 0.4R) = S, so 0.4R = 0.78S − 720, i.e. R = 1.95S − 1800.
X's imports: from P (600) + from C (48) + from ROW (12% of R) = 0.45S, so 648 + 0.12(1.95S − 1800) = 0.45S. That gives 648 + 0.234S − 216 = 0.45S, so 0.216S = 432 and S = 2000.
P → ROW: r = 2000 − 1800 = 200.
Shortcut: write P's and X's imports in terms of S = P's exports; the two equations give S = 2000 directly.
Hence, the answer is 200.
Question 16 · Caselet Based DI
How much is exported from ROW to ROW, in IC?
Answer & solution
Answer: 1008
With S = 2000, ROW's exports R = 1.95 × 2000 − 1800 = 2100.
ROW exports 12% to X, 40% to P and nothing to C (only P exports to C), so the remaining 48% stays within ROW.
ROW → ROW = 48% of 2100 = 1008.
Shortcut: 100% − 12% − 40% = 48% of ROW's exports go to ROW itself.
Hence, the answer is 1008.
Question 17 · Caselet Based DI
What is the trade balance of ROW?
- A
0
- B
-200
- C
100
- D
200
Answer & solution
Answer: Option D
ROW's exports = 2100 (to P 840, to X 252, to ROW 1008).
ROW's imports: from P 200, from X 60% of 1100 = 660 (X exports 40% to P and none to C), from C 32, from ROW 1008. Total = 1900.
Trade balance = 2100 − 1900 = 200.
Shortcut: the ROW → ROW flow appears on both sides and cancels; compare ROW's exports to P and X (1092) with its imports from P, X and C (892): 1092 − 892 = 200.
Hence, the answer is option 4.
Question 18 · Caselet Based DI
Which among the countries P, X, and C has/have the least total trade?
- A
Only X
- B
Only C
- C
Both X and C
- D
Only P
Answer & solution
Answer: Option C
Total trade = exports + imports.
P: 2000 + 2000 = 4000.
X: exports 0.55 × 2000 = 1100, imports 0.45 × 2000 = 900; total 2000.
C: exports 800, imports 1200; total 2000.
X and C tie for the least total trade.
Shortcut: X's total is 0.55S + 0.45S = S = 2000, the same as C's 800 + 1200.
Hence, the answer is option 3.
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