Would link to another site (that ranks for same terms) from my site increase that sites rankings?

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There are many ways to influence your web page ranking in SERPs, PageRank is but one of many signals. 

What you are asking about is a technique commonly referred to as reciprocal linking. While Google frowns on this practice if done for the purpose of PageRank manipulation if you do it just once or twice it isn’t likely to have any penalty applied. However, if Google detects a pattern of reciprocal link exchanges you may get your web page de-indexed. 

You may want to consider linking to highly relevant and useful pages for the purpose of increasing the utility value of your web page. This technique can be very effective in boosting your SERP rankings. This technique is commonly referred to as building a web hub. Users love highly useful web hubs and Google recognizes what users find useful.

My advice to you is to link to the external web page if it adds utility value to your page. Do it because it makes your pages better for users, you will be safe, and Google will likely reward you for it.

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