The concept of 'Terms of Trade' deterioration for developing countries was emphasised by:
A. Raul Prebisch and Hans Singer
B. Heckscher and Ohlin
C. David Ricardo
D. Adam Smith
Answer: Option A
Solution (By JKSSB Mock Tests)
The Prebisch-Singer hypothesis argues that the terms of trade of primary commodity exporters (mostly developing countries) tend to deteriorate over time relative to manufactured goods.
Explanation:
Current Account Deficit occurs when the value of imports of goods, services and transfers exceeds the value of exports of goods, services and transfers.
Explanation:
The endogenous-money approach argues that the quantity of money is determined by the demand for loans and the willingness of banks to extend credit, with the central bank mainly setting the price of reserves rather than the quantity of base money.
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