Calculate the change in price for each Export sector between 2007 and 2015 (relative to the base year 2007).

5:   (20 points) Terms of Trade: Download the EXCEL file < CANADA-import-export-price-index_2015>.

The file has data on the volume index for imports and exports by commodity group and an index of prices for each category. 

The index has 2007 as the base year.  All sectors are given an index of 100.  If, in 2013, the index rises to 102, then the prices in that sector have risen by 2%.  If the index is 98, the prices have fallen by 2%. Similar for volumes.

a)     
Calculate the change in price for each Export sector between 2007 and 2015 (relative to the base year 2007).  Which Export sectors have had the most significant price changes in the 2007-2015 period?  Which the least?  Discuss. 

b)    
Which Export sectors have had the most significant volume changes in the 2007-2015 period?  Which the least?  Discuss.

c)     
Calculate the change in price for each Import sector between 2007 and 2015.  Which Import sectors have had the most significant price changes in the 2007 and 2015 period?  Which the least?  Discuss.

d)    
Which import sectors have had the most significant volume changes in the 2007-2015 period?  Which the least?  Discuss.

e)     
Take the ratio of Export price index (for all merchandise trade) to the Import price index to get the Terms Of Trade (TOT) for Canada for 1997 and 2015.  Discuss the pattern that emerges.  Is the TOT rising? Falling? Comment. 

f)      
Can you tell if any one sector is driving the TOT result in terms of price or volume?  EG  How import is crude oil?  Discuss. (Note, consider ‘small’ sectors in addition to ‘big’ sectors too.)

g)     
Was 2007 an aberration? Discuss.