terms of trade
n.
prices of products exported from a country compared to the price of goods imported
Terms of trade
In international
economics and
international trade, terms of trade or TOT are the ratio of the price of an export commodity/-ies to the price of an import commodity/-ies. "Terms of trade" are sometimes used as a proxy for the relative
social welfare of a country, but this heuristic is technically questionable and should be used with extreme caution. An improvement in a nation's terms of trade is good for that country in the sense that it has to pay less for the products it
imports, that is, it has to give up fewer
exports for the imports it receives.
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Terms of trade
The weighted average of a nation's export prices relative to its import prices.
Terms of Trade
figures that look at the relationship between imports and exports; they can be negative, positive or balanced.It refers to the economic factors affecting a country's foreign trade in goods and services, such as dependency on foreign sourcing and relative competitiveness in production.
Terms of trade
Allocation of inputs into two or more economies that take advantage of differences in comparative advantages and, through specialization, improve the production of the economies. Note that a change in the terms of trade should cause all domestic production to change (i.e. re-allocates all inputs), rather than just imports.
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