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Economics (AS & A Level) · Feb / March 2025 · Paper 12 · Question 26

9708The reasons for international trade

Country X trades with country Y. What are the terms of trade for country X?

  1. Aaverage price of country X's exports divided by the average price of country Y's exports
  2. Bthe ratio of an index of country X's export prices to an index of its import prices
  3. Cvalue of country X's exports divided by the value of country Y's exports
  4. Dvalue of country X's imports divided by the value of country Y's imports

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Correct answer: B. the ratio of an index of country X's export prices to an index of its import prices

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