The formula index of export prices/index of import prices * 100 is used to measure the

The formula index of export prices/index of import prices * 100 is used to measure the commodity terms of trade between two countries. Commodity terms of trade refers to the ratio of the price of a country's exports to the price of its imports. This formula takes into account the prices of goods that are both imported and exported between two countries, and expresses their relationship as an index. If the resulting number is greater than 100, it means that the country's exports are becoming more expensive relative to its imports. Conversely, if the number is less than 100, it means that the country's exports are becoming cheaper relative to its imports. Therefore, this formula is used to gauge the relative strength of a country's exports compared to its imports and can have an impact on a country's balance of payments and overall economic health.