The International Economy Deffinitons Flashcards
Absolute advantage
When an economy is able to produce greater quantity of output with the same quantity of input.
Aid
Transfer of resources between economies.
Bilateral aid
Aid given from one country to another.
Comparative advantage
When an economy is able to produce a greater quantity of output at a lower opportunity cost.
Debt relief
Partial or total forgiveness of debt slowing of debt growth.
Developed countries
Countries with high GDP per capita; tend to export manufactured
goods.
Developing countries
Countries with low GDP per capita; tend to export agriculture.
Economic development
Assessing the standards of living and economic welfare of those in a country.
Economic integration
The process by which economies become more closely linked.
Emerging countries
Countries that aren’t fully developed, yet are more developed thanLEDCs.
FDI
When firms in one country make investments into another country.
Free trade
Trade with no barriers or restrictions.
Globalisation
The process in which economies become increasingly interconnected and
markets become worldwide in scope.
HDI
Measures an economy’s development based on 3 main criteria; life expectancy, educational achievement, and living standards.
MNC
Multi-national corporation (MNC): Firms that operate in multiple countries.
