Principles of Macroeconomics: International Trade

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What is trade?

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The exchange of goods and services between parties.

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What is intra-national trade?

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Trade between partners within the same country.

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What is international trade?

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The exchange of goods and services between countries.

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What is specialization in trade?

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The focus on producing certain goods to achieve economies of scale.

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What is absolute advantage?

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The ability of a country to produce a good using fewer inputs than another country.

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What is comparative advantage?

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The ability of a country to produce a good at a lower opportunity cost than another country.

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What are net exports?

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The value of exports minus the value of imports.

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What is a trade deficit?

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The excess value of imports over exports.

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What is a trade surplus?

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The excess value of exports over imports.

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What is balanced trade?

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When export value equals import value.