Economics 1021A/B Chapter Notes - Chapter 7: Deadweight Loss, Import Quota, Canadian Airlines

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ECON 1021A/B Full Course Notes

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Chapter 7- how global markets work imports- goods and services we buy from other countries exports- goods and services we sell to people in other countries. International trade today: united states is the world"s largest international trader, germany and china rank second and third, lag by a large margin in 2008 canadian exports were billion, imports were billion. What drives international trade? comparative advantage is the fundamental force that drives international trade national comparative advantage as a situation in which a nation countries gain from international trade. Winners, losers and the net gain from trade international trade has winners but it also has losers. International trade restrictions four sets of tolls to influence international trade and protect domestic industries from foreign competition. The effects of a tariff expands surplus shrinks surplus from imports and total surplus quantity surplus shrinks expands surplus from exports: with a tariff set at per shirt, changes occur.

Related Questions

A political commentator makes the following statement: âThe idea that international trade should be based on comparative advantage of each country is fine for rich countries like the United States and Germany. Rich countries have educated workers and large quantities of machinery and equipment. These advantages allow them to produce every product more efficiently than poor countries can. Poor countries like Benin and Bolivia have nothing to gain from international trade based on comparative advantage.â Discuss this view.

According to international trade theory, a country should:

import goods in which it does not have a comparative advantage.
export goods in which it does not have a comparative advantage.
export goods in which it does not have an absolute advantage.
import goods in which it has a comparative advantage.

scarletporpoise64

what is a key factor that determines a firm's profitability?

A differentiation of a firm's product from other products

B factors affecting a firm's entire market

C a firm's average cost of production relative to that of competing firms

D chance events

E all of the above

economic theory suggests countries benefit from international trade by producing more of those good and services for which they have a comparative advantage (and less of that for which a country does not have a comparative advantage). However, countries rarely specialize completely, why?

even with international trade, countries rarely specialize completely because

A, all goods and services can be traded internationally

B, some countries would lose as a result of free trade

C, consumers in different countries have homogeneous tastes

D, some countries do not have an absolute advantege producing anything

E, production of most goods involves increasing opportunity costs.

Economics 1021A/B Chapter Notes - Chapter 7: Deadweight Loss, Import Quota, Canadian Airlines

ECON 1021A/B Full Course Notes

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