Asked by macie hutchinson on May 05, 2024
Verified
The terms of trade reflect the
A) rate at which gold exchanges internationally for any domestic currency.
B) ratio at which nations will exchange two goods.
C) fact that the gains from trade will be equally divided.
D) cost conditions embodied in a single country's production possibilities curve.
Terms Of Trade
An economic measure of a country's export prices relative to its import prices, indicating the quantity of imports that can be exchanged for a given amount of exports.
Domestic Currency
The official currency issued by a country's central bank or monetary authority, used within the domestic economy.
Production Possibilities Curve
A graphical representation showing the maximum combination of goods or services that can be produced with a fixed amount of resources.
- Identify the factors that determine the terms of trade between nations.
Verified Answer
BW
Broto WasesoMay 10, 2024
Final Answer :
B
Explanation :
The terms of trade refer to the ratio at which two countries exchange goods with each other, essentially determining how much of one good a country can obtain for a given quantity of another good when trading internationally.
Learning Objectives
- Identify the factors that determine the terms of trade between nations.