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world trade
| Term | Definition |
|---|---|
| Imports | goods bought from other countries for DOMESTIC USE |
| Exports | goods sold to OTHER countries |
| Absolute Advantage | ability of one country to produce a product more efficiently(greater output per input) than can another country |
| Specialization | Nation SHOULD produce and export a limited amount of goods for which it is particularly suited in order to remain profitable |
| Comparative Advantage | Country to produce a product at a LOWER cost than another country |
| Exchange rate | price of one nation's currency in terms of another nation's currency |
| Foreign Exchange Markets | markets dealing in buying and selling foreign currency for businesses that want to import goods from other countries |
| Fixed Rate of Exchange | a national Gov't sets the value of its currency in relation to a single standard |
| International Monetary Fund | agency whose member Gov'ts once were obligated to keep their foreign exchange rates FIXED |
| Devaluation | Lowering a currency's value in relation to other currencies by Gov't order |
| Flexible Exchange Rate | arrangement where the forces of supply and demand are allowed to set the price of various currencies |
| Depreciation | FALL in price of a currency through the action of supply and demand |
| Balance of Trade | DIFFERENCE between the value of a nation's exports and its imports |
| Revenue Tariff | TAX on imports to raise Gov't revenue without restricting imports |
| Protective Tariff | tax on imports sued to raise the cost of imported goods and thereby protect domestic producers |
| Import Quota | restriction imposed on the number of of units of a particular good that can be brought into the country |
| Embargo | complete restriction on the import or export of a particular good |
| Protectionists | people who argue for trade restrctions to protect domestic industries |
| General Agreement on Tariffs and Trade | trade agreement under which countries met periodically to negotiate tariff reductions that were mutually advantageous to all members |
| World Trade Organization | worlds largest trade agreement currently with more than 140 nations |
| North American Free Trade Agreement | trade agreement designed to reduce and gradually eliminate tariff barriers among Mexico, Canada and the United States |
| European Union | organization of European nations whose goal is to encourage economic integration as a single market |
Created by:
mitchell0618
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