What is Export Ratio and Why Should You Care?
The Export Ratio is an essential economic indicator that shows the proportion of a country's exports relative to its imports. It helps you understand how much a country is selling abroad compared to what it's buying from elsewhere.
A high Export Ratio means exporting more than importing, which is generally a sign of economic health. A low Export Ratio could indicate a trade deficit. Investors, policy-makers, and businesses keep a keen eye on this ratio to make informed decisions.
How to Calculate Export Ratio
Formula
$$\text{Export Rate} = \frac{\text{Exports}}{\text{Imports}} \times 100$$
Where:
- Export Rate (%) is the proportion of exports to imports as a percentage
- Total Export Price is the sum of all values of exported goods and services
- Total Import Price is the sum of all values of imported goods and services
Calculation Example
- Total Export Price: $800
- Total Import Price: $1,200
$$\text{Export Rate} = \frac{800}{1200} \times 100 = 66.67%$$
The Export Ratio is 66.67%. This means the country exports about two-thirds of what it imports.
| Variable | Value |
|---|---|
| Total Export Price | $800 |
| Total Import Price | $1,200 |
| Export Rate | 66.67% |
You might also like: Cost of Sales Calculator, Cost Per Impression Calculator, or Retained Earnings Calculator.