4.1 Importance of international trade

Question 1

Export

Answer 1

Goods and services sold abroad- An inflow of money

Question 2

Import

Answer 2

Goods and services bought from abroad. AN outflow of money

Question 3

International trade

Answer 3

The exchange of goods and services between countries

Question 4

What are benefits of imports and exports for consumers (3)

Answer 4

Lower prices
Greater variety of goods
Greater quality/ innovative goods

Question 5

What are benefits of imports and exports for producers (4)

Answer 5

Access to a larger market to sell goods and services
Increased competition leading to greater efficiency
Can buy raw materials at lower prices
Specialisation and lower average costs as they supply more

Question 6

European union

Answer 6

An economic and political group of countries in Europe that have free trade with each other

Question 7

Free trade agreement

Answer 7

When there is free movement of goods and services between countries without any restrictions

Question 8

What are some characteristics of the EU
(trade area)
(trade outside)

Answer 8

• Largest single market area
• Member states have the same range of trade with countries outside the EU