Chapter 3 - Globalization Textbook Notes

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University of Waterloo
Accounting & Financial Management
AFM 131
Robert Sproule

Chapter 3Competing in Global Markets Dynamic Global Market o Canada is a large exporting nation as our population is 05 of the worlds population o Export selling products to other countries o Import Buying products from another country o Global trade allowsa nation to produce what it is most capable of producing over and above local consumptionbuy what it needs from other nations which is mutually beneficial o Free Trade movement of goods and services among nations without political or economic barriersPros more customers more competition inspires innovationCons loss of domestic jobs pay cuts for domestic workers loss of comparative advantage o Comparative producing more effectively and efficiently versus absolute advantage producingwhat someone else cannot produce or more efficiently than all other countries Getting Involved in Global Trade o ImportingCertain restriction such as prohibited items alcohol and tobacco farm products labelling standards vehicle emission standards food safety electric appliance safety certification o See the categories of Canadas merchandise and service trade in Figure 33 pg72 o Global trade is measured by the balance of trade and the balance of paymentsBalance o
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