RSM100Y1 Chapter Notes - Chapter 4: Foreign Exchange Market, Protective Tariff, Business Cycle
Document Summary
4. 2 how nation measure trade & significance of exchange rates: balance of trade, balance of payment. Chapter 4 competing in world markets. 4. 1 importance of international business. Increase economic growth by providing. New market for products. Access to needed resources. Benefit from factors of production of the other country. Availability, price, quality of labor, natural resource, capital, entrepreneurship. Because different nations at different stages of business cycle / phases of development. Benefit from the size of international marketplace. Developing countries have lower per- capita, but growing population (e. g. china, Difference between exports and imports. Trade surplus - - - export > imports. Trade deficit - - - export < imports. Overall money flows into and out of a country (inflows - outflows) Balance- of- payments surplus - - - positive, more money moved into a country. Balance- of- payment deficit - - - negative, more money has gone out of the country.
