COMMERCE 1E03 Lecture Notes - Lecture 3: Contract Manufacturer, Private Label, Free Trade
3 Feb 2017
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Document Summary
Global trade enables a nation to produce what it is most capable of producing and to buy what it needs from others in a mutually beneficial exchange relationship. Free trade: the movement of goods and service among nations without political or economic barriers. Comparative advantage theory: a country should sell to other countries those products that it produces most effectively and efficiently, and buy from other countries those products that it cannot produce as effectively or efficiently trade. Absolute advantage: the advantage that exists when a country has a monopoly on producing a specific product or is able to produce it more efficiently than all other countries. Trade is important because it enhances the quality of life for canadians and contributes to our country"s economic well-being. Export alone account for 1 in 3 canadian jobs. Balance of trade: a nations ratio of exports to imports.
