International Trade

what are the reasons for international trade?

• unequal distribution of resources and specialization

• good brought into the country

• goods sent to other countries

• to concentrate their efforts on producing a few goods and services instead of everything they need

good brought into the country

• imports

• exports

• absolute advantage

• comparative advantage

goods sent to other countries

• imports

• exports

• absolute advantage

• comparative advantage

why do countries specialize in certain products when they trade

• unequal distribution of resources and specialization

• the ability to produce more of a given product than someone else

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

• to concentrate their efforts on producing a few goods and services instead of everything they need

the ability to produce more of a given product than someone else

• imports

• exports

• absolute advantage

• law of comparative advantage

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

• absolute advantage

• comparative advantage

• law of comparative advantage

• no advantages

a nation is better off when it produces goods and services for which it has a comparative advantage

• law of comparative advantage

• trade deficit

• exports

• imports

Exports exceed imports

• trade surplus

• trade deficit

• surplus

• balance of trade

An excess of imports over exports

• trade surplus

• surplus

• trade deficit

• balance of trade

is a trade surplus or deficit better for a country

• surplus

• trade surplus

• trade deficit

• balance of trade