Palm oil and palm kernel are in

Step 1: Analyze the question The question asks what kind of relationship exists between palm oil and palm kernel. Both come from the same source: the oil palm tree and its fruit.

Step 2: Explain the concept

• Joint supply: Two or more goods are produced from the same raw material or process. Increasing the supply of one automatically increases the supply of the other. Examples: beef and hides, mutton and wool, petrol and diesel.
• Competitive supply: Goods that use the same resources, so producing more of one means producing less of the other. Examples: yam and cassava grown on the same farmland.
• Competitive demand: Substitute goods, where a rise in the price of one raises demand for the other. Examples: Peak milk and Cowbell milk.
• Complementary demand: Goods used together. Examples: bread and butter, car and fuel.

Step 3: Apply to the question The oil palm fruit has two parts:

• The fleshy outer part (mesocarp) gives palm oil.
• The nut inside the fruit gives palm kernel.

When a farmer harvests and processes oil palm fruit, both products come out of the same fruit. So a rise in palm oil production brings a rise in palm kernel supply. This is the definition of joint supply.

Step 4: Check the other options

• B (competitive demand): Palm oil and palm kernel are not substitutes for each other.
• C (competitive supply): They do not compete for the same resources, because they come from the same fruit.
• D (complementary demand): They are not consumed together to satisfy one want.

Answer: A. Joint supply

Exam tip: Remember "same source, two products = joint supply." If a question mentions products from the same raw material (cotton and cottonseed, beef and hides, palm oil and palm kernel), think joint supply right away.