Why Nations Trade
What is it called when a country focuses on producing what it does best?
Specialization
What is a tax on imported goods called?
Tariff
What international organization enforces trade agreements between countries?
World Trade Organization (WTO)
Which fast-food chain is a symbol of global products and markets?
McDonald's
What is the term for the comparison between currencies of different countries?
Exchange rate
What do countries gain when they trade with each other?
Greater world output
What term describes a limit on the number of goods imported?
Quota
What trade Agreement involves the US, Canada, and Mexico?
NAFTA (North American Free Trade Agreement)
What regional organization developed the euro?
European Union
What is the term for exchange rates that change based on market conditions?
Fixed exchange rate
What is the term for producing a product more efficiently than another country?
Absolute Advantage
What is the term for a government ban on trade with a specific country?
Embargo
What does GATT stand for?
General Agreement on Tariffs and Trade
What is the term for the process of companies moving jobs to other countries?
Outsourcing
Which index compares the price of a Big Mac across different countries?
Big Mac Index
Which type of advantage considers opportunity cost in trade decisions?
Comparative Advantage
What do we call the economic policy of limiting imports to protect domestic jobs?
Protectionism
What organization Offers policy advice and supports all currencies
IMF (International Monetary Fund)
Name one obstacle to economic development in developing countries
Population growth OR natural resources/Geography OR Disease/Substance Abuse OR Lack of education/technology OR Debt OR Corruption OR War OR Capital Flight
What happens to the value of the dollar during a trade deficit?
It weakens
What is the political benefit of international trade between countries?
Increased political stability
Which 1930s act raised tariffs and worsened the Great Depression?
Hawley-Smoot Tarriff
What organization provides loans to developing countries?
What is the term for the illegal export of a nation’s currency?
Capital Flight
What does a strong dollar lead to: more imports or more exports?
More imports