Asked by Dan Francis Rodriguez on Apr 24, 2024
Assume that Down Slope specializes in producing snow boards and Seven Seas specializes in producing scuba tanks. After trade, Down Slope exports 2,000 snow boards and imports 400 scuba tanks. The terms of trade
A) are 1/5:1 snow boards to scuba tanks.
B) are 5:1 snow boards to scuba tanks.
C) are 1:5 snow boards to scuba tanks.
D) cannot be determined from this information.
Terms of Trade
The proportion between a country's export price index and its import price index.
Snow Boards
Not an economic term, likely refers to snowboards, which are equipment used for snowboarding.
Scuba Tanks
Cylinders containing compressed gas, typically air or a specialized gas mixture, used by scuba divers to breathe underwater.
- Understand the concept of terms of trade and how they are determined.
Learning Objectives
- Understand the concept of terms of trade and how they are determined.