A major feature of the international economy over the past decade has been the swings in the value of the US dollar. The dollar fell to a historically low level in the late I970s, but rose sharply over the period i982-4. By the beginning of I985 the dollar was generally considered to be over-valued by between 2o and 40 %. Since I985 there has been a depreciation of over one third. These wide fluctuations in the value of the dollar have had implications for all major traded goods. This paper focuses on the effects of changes in the value of the dollar on primary commodity prices, and possible interactions between LDC indebtedness and these effects. A rise (fall) in the value of the dollar must be expected to result in a fall (rise) in dollar commodity prices. Ridler and Yandle (I972) proposed a simple comparative static single-commodity model to analyse the effects of exchange rate changes on the price of an individual primary commodity.' They showed that the commodity price change would be given by the change in an appropriately weighted exchange rate index. Write the price of commodityj as