Question

In what way does comparing a country’s exports to GDP reflect its degree of globalization?

a) It shows the level of dependency on imports
b) It indicates the country's comparative advantage
c) It demonstrates the extent of international trade relations
d) It measures the economic stability of the country

Answer 1

Comparing a country's exports to its GDP indicates its degree of globalization, with a higher ratio suggesting more global integration. Canada had an export ratio of 30.11% when its GDP was $1,800 billion and exports were $542 billion.

Step-by-step explanation:

Comparing a country's exports to its GDP is a crucial metric that reflects its degree of globalization. This export ratio signifies what share of a country's total economic production is sold in other countries, indicating the extent of its integration with the global economy. Countries with a high percentage of exports relative to their GDP, like Germany, demonstrate a high level of trade and globalization, while countries with a lower percentage, such as the United States, which exports around 13% of its GDP, show a smaller degree of economic globalization.

To calculate Canada's export ratio, we use the given figures: Canada's GDP was $1,800 billion and its exports were $542 billion. By dividing the exports by the GDP and then multiplying by 100, we get the export ratio: ($542 billion ÷ $1,800 billion) × 100 = 30.11%. So, Canada had an export ratio of 30.11% at that time.