WAEC Economics 2015 Objective — Question 46
Question 46 of 50 from the West African Examinations Council (WAEC) Economics 2015 Objective paper, with the correct answer and a full explanation.
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A country has favourable terms of trade when the prices of her
- A. exports rise relative to the prices of importsCorrect
- B. exports fall relative to the prices of imports
- C. imports rise faster than the prices of exports
- D. imports and exports move in the same direction
Explanation
Favourable terms of trade occur when export prices rise relative to import prices, meaning a country can now import more for the same quantity of exports.
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