could anyone explain the terms of trade?
Answers
Answer:
The terms of trade (TOT) is the relative price of exports in terms of imports and is defined as the ratio of export prices to import prices. ... An improvement of a nation's terms of trade benefits that country in the sense that it can buy more imports for any given level of exports.
Answer:
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Explanation:
The terms of trade (TOT) is the relative price of exports in terms of imports and is defined as the ratio of export prices to import prices. It can be interpreted as the amount of import goods an economy can purchase per unit of export goods
Terms-of-Trade Effect. Determines the effect of a change in the world price of a commodity on the value of a country's exports and imports as a percent of GDP.
Improving terms of trade
If a country's terms of trade improve, it means that for every unit of exports sold it can buy more units of imported goods. ... It can also have a beneficial effect on domestic cost-push inflation as an improvement indicates falling import prices relative to export prices.
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