Which of the following is the appropriate measure of openness of the economy?
The trade-openness ratio is total trade X+M relative to GDP. Exports/imports is a coverage ratio; exports−imports the trade balance; the balance/population is per-capita net…
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Which of the following is the appropriate measure of openness of the economy?
Answer and explanation
Correct answer C
The trade-openness ratio is total trade X+M relative to GDP. Exports/imports is a coverage ratio; exports−imports the trade balance; the balance/population is per-capita net trade. Those do not measure the total scale of cross-border trade relative to output.
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UGC NET Economics