international trade and access to markets

Question 1

reasons for trade

Answer 1

• comparative advantage
• to benefit from technology
• benefit from resources
• take advantage of economies of scale

Question 2

goods

Answer 2

• exported from LIC and NEE
• agricultural and manufactured goods

Question 3

services

Answer 3

• exported from HIC
• financial services

Question 4

trade agreements

Answer 4

• trade blocs: support free trade bewteen member countries without tariffs
• OPEC petroleum exporting countries
• NAFTA
• EU

Question 5

levels of integration

Answer 5

1. common market
   - member countries trade freely
2. customs union
   - removal of tariffs between members and can negotiate with other blocs and WTO
3. free trade area
   - 2+ ountries in a region agree to reduce/eliminate tariffs on goods coming from other members

Question 6

advantages of trade blocs

Answer 6

• global peace and security
• develops economies
• individual countries have larger voices
• developing common currency simplifies transactions
• raise standards of living

Question 7

disadvantages of trade blocs

Answer 7

• loss of sovereignty
• loss of financial controls
• pressure for centralised legislation
• outsider countries face further global trading barriers

Question 8

differential access to markets

Answer 8

those in more integrated trade blocs will make more money than those outside of trade blocs
west africa: the least integrated region in terms of cross border trade

Question 9

solution to barrier trade - SDT

Answer 9

• put in place by WTO
• support measure overcome specific disadvanatges
• gives LDCs access to markets

Question 10

solution to barrier trade - fair trade

Answer 10

• social movement to help producers achieve better conditions
• direct trade from businesses to farmers
• businesses offer favourable prices, producers given more power to negotiate