What is the value of the intra-industry trade index for an industry in which exports are $100 million and imports are $100 million?
A) 100/200 = 0.50
B) (100 + 100)/100 = 2.00
C) 100/[1/2 · (100 + 100)] = 1.00
D) (100 - 100)/100 = 0.00

Question

Quizplus · Accepted Answer

The intra-industry trade index is calculated as the ratio of the smaller value of exports and imports to the sum of exports and imports. In this case, the smaller value is $100 million (which is both exports and imports) and the sum is $200 million, so the calculation is 100/[1/2 · (100 + 100)] = 1.00.

What Is the Value of the Intra-Industry Trade Index for an Industry