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JAMB Economics 1992 Question 47

Question 47

International Trade

The terms of trade of a country is defined as

  1. A.(index of import prices ÷ index of export prices) × 100
  2. B.(index of exportables ÷ index of importables) × 100
  3. C.(index of visible imports ÷ index of visible exports) × 100
  4. D.(index of export prices ÷ index of import prices) × 100
Show the answer and explanation

Answer: D ((index of export prices ÷ index of import prices) × 100)

Explanation

Terms of trade = (index of export prices ÷ index of import prices) × 100.