Topic 4.1 Globalisation

Question 1

What is globalisation?

Answer 1

Globalisation is the process of economic integration between countries and regions of the world

Question 2

What are the causes of globalisation?

Answer 2

• The deregulation of markets
• Political changes
• The removal of barriers to trade
• The lowering of transportation costs
• Improved communication systems

Question 3

What are the Impacts of globalisation?

Question 5

What are the advantages of multinationals?

Answer 5

• Provide employment and create better living standards
• Infrastructure development due to investment
• Introducing new technology
• Increased economic growth

Question 6

What are the disadvantages of multinationals?

Answer 6

• Can cause domestic businesses to fail
• Multinationals can be accused of destroying local culture
• Negative environmental impact

Question 9

What is economic growth?

Answer 9

• Economic growth occurs when a country produces more goods and services in one year than the year before

Question 10

How is economic growth measured?

Answer 10

• GDP
• Literacy rates
• HDI
• Healthcare

Question 11

What are the positives of economic growth?

Answer 11

• Increased consumer spending, leads too increased sales
• Increased expansion opportunities
• Increased profits and investment for businesses

Question 12

What are the negatives of economic growth?

Answer 12

• Increased competition from expanding businesses
• Increased prices leading to inflation
• Shortage of labour leading to increased costs and wages
• Increased exchange rates

Question 13

What is a BRIC economy?

Answer 13

• Brazil, Russia, India, China
• Emerging superpowers as they have one of these: high populations, access to resources, regional influence and high economic growth

Question 14

What is a MINT economy?

Answer 14

• Mexico, indonesia, Nigeria, Turkey
• They have the potential to become superpowers

Question 15

What are the indicators of growth?

Answer 15

• Income levels
• Education (Literacy rates)
• Healthcare (life expectancy, child mortality rates and access to healthcare)

Question 16

Is HDI a good measurement of growth?

Answer 16

-

Question 17

What are the four types of protectionism? (Tarrifs)

Answer 17

• A tax placed on imports to increase its price and lower the demand
• Consumers will switch to domestic goods
• Used to restrict imports

Question 18

What are the four types of protectionism? (Quotas)

Answer 18

• A type of tariff places on imports

Question 19

What are the four types of protectionism? (Subsidies)

Answer 19

• A way for the government to protect their domestic markets
• Money is given to local producers o make their goods cheaper and increase demand and make them more competitive

Question 20

What are the four types of protectionism? (Government action)

Answer 20

• legislation on product quality requirements to restricting products that do not meet them
• Exchange controls - Limiting the foreign exchange that can move between countries
• Preferential state procurement policies - Where a government favours domestic businesses

Question 21

What is protectionism?

Answer 21

When governments put in place policies to stop overseas producers freely selling goods in our country (Restrict trade)

Question 22

What is free trade?

Answer 22

When governments put in place policies that allow producers from overseas nations to freely sell their goods in our country (Promote trade)

Question 23

What are the arguments for protectionism?

Answer 23

• Protect key strategic industries (eg. farming)
• Protect domestic jobs
• Raise money for governments
• Reduce trade deficit
• Protect new infant industries

Question 24

What are the arguments against protectionism?

Answer 24

• High import prices may not decrease demand
• Tarrifs can raise consumer prices
• Domestic firms may not become more competitive
• Quotas require monitoring