Question on: JAMB Economics - 2018
The formula (index of export prices)/(index of import prices) x 100 is used to measure the____________
A
Volume of trade between countries
B
direction of international trade
C
commodity terms of trade
D
volume of imports
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Correct Option: C
The terms of trade (TOT) is the relative price of imports in terms of exports 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.
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