Ch. 8 Flashcards
globalization
refers to the process by which goods, services, capital, people, info, and ideas flow across national borders
trade deficit
results when a country imports more goods than it exports
trade surplus
occurs when a country has a higher level of exports than imports
gross domestic product
defined as the market value and services produced by a country in a year; the most widely used standardized measure of output
gross national income
consists of GDP plus the net income earned from investments around the world
purchasing power parity (PPP)
a theory that states that if the exchange rates of two countries are in equilibrium, a product purchased in one will cost the same in the other, expressed in the same currency
infrastructure
the basic facilities, services, and installations needed for community or society to function, such as transportation and communication systems, water and power ones, and public institutions like schools
tariff
a tax levied on a good imported into a country; also called a duty
quota
designates the max quantity of a product that may be brought into a country during a specific time period
exchange control
refers to the regulations of a country’s currency exchange rate
exchange rate
the measure of how much one currency is worth in relation to another
trade agreements
intergovernmental agreements designed to manage and promote trade activities for specific regions
trading bloc
consists of those countries that have signed a particular trade agreement
exporting
producing goods in one country and selling them in another
franchising
a contractual agreement between franchisor and franchisee that allows the franchisee to operate a business using a name and format developed and supported by the franchisor
