One reason for worsening terms of trade is that less developed countries are often dependent on one primary commodity for export.

Question

Quizplus · Accepted Answer

This is true because if a country is heavily reliant on one primary commodity for export and the price of that commodity falls in the global market, then the country's overall export revenue will decrease, leading to a worsening of their terms of trade. This is because they will have to export more of the commodity to get the same amount of revenue, while the cost of importing other goods or services remains the same or increases.

One Reason for Worsening Terms of Trade Is That Less