Many developing countries instituted import substitution policies because ........

Economic Affairs Foreign Trade - Trends and Policy

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Many developing countries instituted import-substitution policies because:

the prices of the goods they imported were falling.

their terms of trade were improving.

the prices of the goods they exported were increasing.

their terms of trade were deteriorating.

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Explanation:

Many developing countries instituted import-substitution policies because their terms of trade were deteriorating.
Import substitution industrialization (ISI) is a trade and economic policy which advocates replacing foreign imports with domestic production. ISI is based on the premise that a country should attempt to reduce its foreign dependency through the local production of industrialized products.