There Will Be a Favourable Change in a Nation's Terms

question 12

Multiple Choice

There will be a favourable change in a nation's terms of trade if the

• A)export and import prices fall by the same amount.
• B)export price index rises by more than the import price index.
• C)export and import prices rise by the same amount.
• D)export and import prices stay the same.
• E)import price index rises by more than the export price index.

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Definitions:

Payback Periods

The duration of time it takes to recover the cost of an investment through the investment's cash flows.

Risks

The potential for losing something of value or the chance of an adverse outcome.

Hurdle Rate

The minimum acceptable rate of return on an investment, used as a benchmark for deciding whether to pursue a project.