2.2 The Global Economy: Unit 40 - 42 Flashcards
1
Q
- what is the World Trade Organization?
A
- an international organization that promotes free trade by persuading countries to abolish tariffs and other barriers.
it policies free trade agreements, settles trade disputes between governments, and organizes trade negotiations.
2
Q
- What are the 4 activities of WTO?
A
- trade negotiations.
- implementation and monitoring.
- settling trade disputes.
- building memberships
3
Q
- What are the 5 criticisms of WTO?
A
- It is undemocratic (some rights are ignored(environmental, labor) as they focus on corporations)
- It favors the “rights” of corporations over those of workers.
- It is destroying the environment.
- It favors wealthy nations over poorer ones.
- It is causing hardship for poorer nations.
4
Q
- What are the 5 reasons for an increase in world trade?
A
- better transport and communication.
- relaxing of trade barriers.
- Development of multinationals.
- Travel and consumer awareness.
- Trade agreements.
5
Q
- What are the 3 changes in trade in developed countries?
A
- loss of trade in manufacturing
- more air travel.
- Widening of the development gap.
6
Q
- What are the 5 changes in trade in developing countries?
A
- an increase in net migration
- increased FDI in Africa.
- Rise in commodity dependence.
- Debt cancellation.
- Reduction in barriers.
7
Q
- What is the exchange rate?
A
- price of one currency in terms of another.
8
Q
- What are the 3 factors affecting the demand for a currency?
A
- interest rates.
- currency speculators.
- the demand for exports.
9
Q
- What are the 3 factors affecting the supply of currency?
A
- interest rates in other countries
- currency speculators
- the demand for imports.
10
Q
- What is the foreign exchange market?
A
- market where foreign currencies can be bought and sold.
11
Q
- What is the meaning appreciate?
A
where the value of a currency rises owing to market forces- the exchange rate increases as a result.
12
Q
- What is revalued?
A
- when a government fixes a new higher exchange rate.
13
Q
- What is depreciate?
A
- where the value of a currency falls owing to market forces - the exchange rate falls as a result.
14
Q
- what is devalued?
A
- when a government fixes a new lower exchange rate.
15
Q
- What is the impact on imports and exports after the appreciation?
A
imports :- demand will rise as goods become cheaper.
exports:- demand will fall as goods of the native country have become expensive.