BASIC CONCEPTS
What are abrupt fluctuations in international prices?
Sudden and significant changes in global prices
How can political conflicts affect international prices?
They disrupt supply and increase prices
How do price fluctuations affect importers?
They increase purchasing costs
Which energy resource often experiences international price fluctuations?
Oil
How can companies reduce risk from price fluctuations?
Diversifying suppliers
What is a commodity in international trade?
A raw material traded globally
How do natural disasters influence global prices?
They reduce production and raise prices
How do price fluctuations affect exporters?
They change export revenues
Which agricultural product is sensitive to climate and price changes?
Wheat
What financial tool helps fix future prices for commodities?
Futures contracts
What is supply in global markets?
The amount of goods available for sale
How can exchange rates affect international prices?
Currency changes alter trade costs
How do international price changes affect consumers?
They change product prices
Which precious metal rises in price during crises?
Gold
Why do companies diversify suppliers?
To reduce supply risk
What is demand in international markets?
The desire and ability to buy goods
How do changes in global demand affect prices?
Higher demand increases prices
How do price fluctuations affect production costs?
They change input costs
Which mineral increased in price due to electric vehicles?
Lithium
Why do firms monitor international market trends?
To anticipate price changes
What is price volatility?
Frequent and unpredictable price changes
How can trade restrictions affect international prices?
They limit supply and raise prices
How can price volatility affect global trade?
It creates uncertainty in markets
Which commodity is influenced by OPEC decisions?
Oil
How can long-term contracts help companies manage price volatility?
They stabilize prices