If exports of an industry are $100 million and imports are zero,
Which of the following is the value of the index of intraindustry
Trade?
A)0
B)1
C)0.5
D)100 million

Question

If exports of an industry are $100 million and imports are zero,
Which of the following is the value of the index of intra­industry
Trade?
A)0
B)1
C)0.5
D)100 million

Quizplus · Accepted Answer

The index of intra-industry trade is calculated as (1 - |exports - imports| / (exports + imports)). With exports of $100 million and imports of $0, the index is (1 - |100 - 0| / (100 + 0)) = 0.

If Exports of an Industry Are $100 Million and Imports