Meaning of terms of trade,balance of trade and balance of payment.
Answer Text: Terms of trade,balance of trade, balance of payment.Terms of trade:-refers to the rate at which a countryโs export exchange against her imports.-if they are greater than one, they are said to be favourable and if they are less than one they are said to be unfavourable.Terms of trade=๐๐๐๐๐ ๐๐๐๐๐ฅ ๐๐ ๐๐ฅ๐๐๐๐ก๐ ๐๐๐๐๐ ๐๐๐๐๐ฅ ๐๐ ๐๐๐๐๐๐ก๐ Balance of trade:-refers to the difference between the value of visible exports and visible imports of a country over a given period of time.-it is favourable if the value of visible exports exceeds value of visible imports and vice versa.Balance of payment(BOP):-refers to a summary statement showing all economic transactions that take place between a country and the rest of the world over a given period of time.-favorable if total receipts are greater than total payments and vice versa.Balance of payment disequilibrium:-it occurs when receipts and payments are not equal resulting to surplus or deficit balance of payment.Surplus balance of payment:-it occurs when a countryโs receipts are greater than payments in a particular year, the balance of payment is referred to as surplus