An increase in the index of income terms of trade implies that
A)A country cannot import more goods in exchange for its exports
B)A country can import more goods in exchange for its exports
C)A country cannot export more goods in exchange for its imports
D)None of the above

Question

Quizplus · Accepted Answer

An increase in the index of income terms of trade implies that a country can import more goods in exchange for its exports, as it indicates an improvement in the country's trade terms, allowing it to gain more from its exports relative to its imports.

An Increase in the Index of Income Terms of Trade