IB
What is the primary goal of the WTO?
Main objective of the WTO is to improve international trade by implicating rules and regulations for more balance and transparency in trade.
What is one advantage, and one disadvantage of trading blocs?
Advantages : More access to a larger market and being able to have economies of scale, More employment opportunities, More Bargaining power in multilateral negotiations,More political stability
Disadvantages: Loss of sovereignty , Difficulties in multilateral trade negotiations ,
What are the three trade agreements types?
Bilateral, regional, multilateral (WTO)
The deduction for a country to export and import based on the opportunity cost, not by the amount of resources is considered to be the _____________.
Comparative Advantage
What is scarcity?
The basic economic problem.
The government can manipulate exchange rates by _________.
Changing interest rates ; Using their reserves of foreign currencies to buy or sell foreign currencies
A group of countries that join together in some form of agreement in order to increase trade between themselves and to gain economic benefits.
Trading Blocs
What allows for more variety of goods and services for consumers and at lower prices. Often happens without barriers.
Trade Creation
With different nations that have different policies and ideology, it can be difficult to agree or compromise which is called _____ and is a disadvantage to Monetary Union.
Political Difference
Both trade diversion and trade creation have to do with the aid or hindrance of _____?
Trading Blocs
When countries come together to have trading agreements, potentially leading to more barriers being placed on external countries that are issuing trade diversion is known as _________.
Trade Diversions
Price stability, less uncertainties, a more competitive business environment, stronger relations between countries, and stronger global trade are all examples of advantages of what ?
Monetary Union
The process of countries working together to coordinate and link economic policies such as trade agreements is known as ____?
Economic Integration
________ occurs when currency rises or falls due to changes in demand or supply of currencies on the foreign exchange market, and there’s no government intervention.
Floating exchange rate
The higher the currency the ___ foreign currency can be bought.
More
Name three benefits from international trade.
Lower prices : More purchasing options : Efficient allocation of resources : Economies of scale : Access to different resources : Access to foreign exchange
Developing countries typically do not have a source of ______ which prevents them from ______.
Foreign exchange : trading
When it takes a country fewer resources to produce a good than another country, the country producing with fewer resources has a(n) _______.
Absolute advantage
A country losing their ability to control their own policies as they release autonomy to control internal rates and their own currency is an example of
Loss of sovereignty in trading blocs
Custom unions with common policies are known as ________.
Common markets