If the nation's taste for its import commodity increases:

Question

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If a nation's taste for its import commodity increases, it implies that the nation is importing more of that commodity from its trading partner. This increased demand for the import commodity puts upward pressure on its price, causing a deterioration in the importing nation's terms of trade. The partner's terms of trade, however, may remain unchanged or even improve if the partner is exporting other goods that are in high demand at the same time.

If the Nation's Taste for Its Import Commodity Increases