If the Terms of Trade Increase Then, Ceteris Paribus

question 120

Multiple Choice

If the terms of trade increase then, ceteris paribus:

• A) imports will fall.
• B) imports will rise.
• C) exports will rise.
• D) exports will fall.

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Definitions:

Countervailing Duties

Tariffs levied on imported goods to offset subsidies made to producers of these goods in their home countries.

General Agreement

A broad contract or understanding between parties that outlines the terms and conditions of their relationship or agreement.

Imported Lumber

Refers to wood that has been sourced from another country and then brought into a domestic market for use or sale.

Tax Treatment

The specific way tax laws apply to various types of income, expenses, and investments.