Which of the Following Terms-Of-Trade Concepts Is Calculated by Dividing

question 74

Multiple Choice

Which of the following terms-of-trade concepts is calculated by dividing the change in a country's export price index by the change in its import price index between two points in time, multiplied by 100 to express the terms of trade in percentages?

• A) commodity terms of trade
• B) marginal rate of transformation
• C) marginal rate of substitution
• D) autarky price ratio

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Definitions:

Face Value

The nominal or dollar value printed on a security or a financial instrument, such as a bond or stock, representing its legal value.

Maturity Value

The amount to be received at the maturity date of an investment, typically the principal plus interest.

Note Duration

The term or length of time until a promissory note, bond, or other financial instrument reaches its maturity date.

Interest Rate

The percentage of a loan amount charged by the lender to the borrower for the use of assets, typically expressed on an annual basis.