2.5 Globalisation

Computers made in China are used by students in Wakefield.

• import

• export

Tires made in UK factories are used on cars in Germany.

• import

• export

Watches made in Norway are worn by people in London.

• import

• export

What is International Trade

• Involves exporting and importing goods abroad.

• Involves exporting and importing goods within the UK

• Involves just importing goods from overseas

Which of the following is not an advantage of International Trade

• Growth in Sales and profit

• Increase the value of the market share

• Increase technological knowledge

• Language Barrier with communication overseas

Which of the following is not a disadvantage of International Trade

• Exchange rates increasing costs

• Reduced Risks of falling sales

• Local taxes and laws creating additional costs

• Problems with supply chains could delay production of products

Exports

• Goods produced in one country and sold in another

• Goods that are brought from producers overseas

Imports

• Goods produced in one country and sold in another

• Goods that are brought from producers overseas

Tariff

• Tax on import expressed as a percentage of the price

• Tax on export expressed as a percentage of the price

Exchange Rates

• Price of one currency expressed in terms of another

• Price of currency which can increase and decrease