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Terms of trade represent the ratio between a country's export prices and its import prices. The ratio is calculated by dividing the price of the exports by the price of the imports and multiplying the result by
Terms of trade definition is - the ratio between the prices of two countries participating in international trade.
pl n. economics, British the ratio of export prices to import prices. It measures a nation's trading position, which improves when export prices rise faster or fall slower than import prices. terms of trade a PRICE INDEX that shows a country's EXPORT prices relative to its IMPORT prices. It is constructed by taking an index of prices received for exports, on the one hand, and an index of prices paid for imports, on the other, and then dividing the first by the second (see Fig. ).
Terms of Trade: Definition/Meaning and Explanation: By terms of trade, is meant terms or rates at which the products of one country are exchanged for the products of the other. It is known to us that every country has got its own money. The currency of one country is not legal tender in the other country. Definition of terms of trade: Not the contractual conditions of sale between a buyer and a seller, but the quantity of foreign goods and services (imports) that a country can purchase from the proceeds of the sale of its goods and.