MGMT 1 Chapter Notes - Chapter 3: Franchising, Common External Tariff, Theory-Theory
21 Jul 2016
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Document Summary
Free trade the movement of goods and services among nations without political or economic barriers. Comparative advantage theory theory that states that 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. 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. Balance of trade the total value of a nation"s exports compared to its imports measured over a particular period. Trade surplus a favorable balance of trade; occurs when the value of a country"s exports exceeds that of its imports. Trade deficit an unfavorable balance of trade; occurs when the value of a country"s imports exceeds that of its exports.
