Which phrase best completes the diagram? ?
-
Terms of trade improve
A. Inflation rates increase
B. Trade deficit increases
C. Exchange rate increases
D. Economic growth decreases

C. Exchange rate increases

Explanation:

If exchange rates increase in favor of the reference country, then this country is likely to have a higher value for its exports than its imports, in other words, the terms of trade of that country will have improved. This is why many countries try to control their exchange rates, instead of letting the market determine them: in order to aim for better terms of trade, and better macroeconomic results as a whole.

every society, in order to meet the needs of it's people, has to answer three basic questions:

- what should we produce?

- how should we produce it?

- for whom should we produce it?

this questions must be answered in order to, option b, aid in production decisions.

every country can't produce everything, no matter how rich their land is. it may be a matter of technology, resources or geographical conditions. so, these three questions must be resolved in order to get the most of the production of each land.

hope this !