The terms of trade refers to
A) the documents that two countries sign in order to facilitate trade.
B) the conditions imposed by the importing country regarding the quality of the imported goods.
C) the exchange rate determined by the exporting and the importing countries.
D) the ratio at which one country trades a domestic product for an imported product.

Question

Quizplus · Accepted Answer

The terms of trade refer to the ratio at which one country exchanges its goods or services for those of another country. This concept is crucial in international economics as it helps in understanding the relative prices of exports and imports between countries.

The Terms of Trade Refers to