Which of the following terms-of-trade concepts is calculated by dividing the change in a country's export price index by the change in its import price index between two points in time,multiplied by 100 to express the terms of trade in percentages?
A) Commodity terms of trade
B) Marginal rate of transformation
C) Marginal rate of substitution
D) Autarky price ratio

Question

Quizplus · Accepted Answer

The described concept is known as commodity terms of trade, which measures the ratio of a country's export prices to its import prices. The formula for calculating it involves dividing the change in the export price index by the change in the import price index between two points in time, and then multiplying it by 100 to express it as a percentage. The other options (B, C, and D) do not relate to the calculation of commodity terms of trade.

Which of the Following Terms-Of-Trade Concepts Is Calculated by Dividing