Lesson 36 - unit 8 Flashcards
What is trade?
Any exchange or purchase of goods and services especially between countries.
How is a nation’s trading activity measured?
With trade balance/ balance of trade
What is trade deficit?
When a country imports more than it exports.
Wat is a trade surplus?
When a country exports more than it imports.
What are some benefits of international trade?
- More goods and services available
- Economic growth
- More jobs
- higher standard of living
- New industries
- Less likely wars because of interdependence.
Who is helped and hurt by exports?
Producers are helped and consumers are hurt.
Who is helped and hurt by imports?
Producers are hurt and consumers are helped.
How are countries helped by specialization?
All countries are better off when countries specialize and trade with other countries for the items they specialize in.
What is opportunity cost?
The greatest alternative good one gives up to engage in a particular activity.
What is comparative advantage?
When one producer has a smaller opportunity cost of producing a good or service compared to another producer.
What is absolute advantage?
Where one person or country can produce goods with a smaller input of resources than another.
