Trade
When Mrs.Smith buys a cell phone that was made in Japan.
What is import?
A tax on imported goods.
What is a tariff?
What is free trade?
The use of tariffs and quotas to shield domestic industries from foreign competition.
What is protectionism?
The loss of value of a country's currency with respect to a foreign currency.
What is depreciation?
When countries make the products that they are the best at making?
What is specialization?
A limit on the amount of goods that can be imported.
The trade deal that Trump renegotiated.
What is NAFTA?
A limit on the amount of foreign goods that can be brought into the country.
What is quota?
This is what makes money worth more or less in foreign countries.
What is currency exchange?
When a nation imports more goods than they export?
What is a trade deficit?
This encourages people to purchase domestic goods.
What is a tariff?
Trump's new free trade deal with Mexico and Canada.
What is USMCA?
Government payments to exporters to help them lower their cost of production.
What is a subsidy?
This considers all international transactions and has two accounts.
What is the balance of payment?
When one country can make more of a good than another country.
What is absolute advantage?
When Country A imposes a tariff on Country B in response to a tariff from Country B. This goes back and forth escalating each time.
Two disadvantages of free trade.
What is...
- more competition for domestic goods
- loss of manufacturing jobs to other countries
The two policies that countries engage in when they are practicing protectionism.
What are tariffs and quotas?
Three things included in the capital account.
What are stocks, bonds, and real estate?
When one country can produce a good at a lower opportunity cost than another country can?
What is comparative advantage?
Consequences of trade barriers.
What is...
- standard of living decreases
- fewer consumer choices
- higher prices for consumers
- lower quality goods
- trade wars
Four advantages of free trade.
What is...
- economic growth
- more product options
- cheaper prices on products
- specialization
Three policies of protectionism.
What is tariffs, quotas, and subsidies?
What is the balance of trade and net transfers?