What is meant by terms of trade? How is it determined?
What will be an ideal response?
The terms of trade refers to the exchange rate of goods for goods. For example, if 170 apples are traded for 20 oranges, the terms of trade are 8.5 apples per orange. Terms of trade are determined on the basis of opportunity cost. For two people or countries to benefit from trade, the trading price must lie between their opportunity costs of producing the good in both countries.
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A trend shows
A) the degree of correlation between two variables. B) the general tendency for a variable to rise or fall. C) the scale used to measure to variables. D) the increases in one variable.
The most important factor in reversing the economic decline of 1929-1933 was that
A. the federal government finally balanced its budget. B. the stock market began to rise. C. people became more optimistic. D. the federal government began to spend a huge amount of money.
Suppose the following information describes the economy:GDP2,000Consumption1,500Government Spending300Net taxes400Public saving equals ________ and national saving equals ________.
A. 200; 100 B. 200; 300 C. 100; 200 D. 100; 100
Since 1970, the highest inflation rate in the U.S. occurred in
A. 1975. B. 1981. C. 1983. D. 1994.