Chapter 17 - Foreign Trade Flashcards
What does importing mean?
The purchase of goods and services from other countries for selling in Ireland
What does exporting mean?
When Irish goods and services are sold to other countries
For all _______ , money leaves Ireland
For all imports, money leaves Ireland
For all _______, money comes in to Ireland
For all exports, money comes into Ireland
What is visible trade and give an example
The import or export of physical goods. For example cars, food, clothing
What is invisible trade and give examples
The import or export of services. For example holidays, concerts
Name the five difficulties associated with foreign trade
✈️ Transport 💵 Foreign currency 🔨 Damage 👄 Language 📑 Documents
What is foreign-trade?
The sale of products and services from one country to another
What is balance of trade?
Balance of trade = visible exports – visible imports
What is balance of payment?
Balance of payment = total exports – total imports
What is import substitution?
The purchase of Irish made goods instead of foreign imports
What do we need foreign currency for?
- To travel to non-euro countries
2. To buy goods from other countries
Explain the buy rate
Say you return from holiday in London and you have some sterling left that you want to turn into euro. So you need to sell your sterling to the bank therefore the bank is buying your sterling so we use the buy rate
Explain the sell rate
You and your family are going to London on holidays, so you need to buy sterling. So, the bank is selling you sterling so you use the sell rate
How do you change euro into a foreign currency?
Do you change euro into a foreign currency, you multiply the euro amount by the sell exchange rate
