SS6E8ab Specialization and Trade Barriers

voluntary trade

• some parties freely agree to trade and gain benefits

• all parties are paid to trade and have no benefits with goods and services

• both parties will have benefits and no money for trading

• both parties freely agree to trade and benefit from exchanging goods and services

any activity which slows or outright blocks the free exchange of goods and services

• sanctions

• tariff

• trade barriers

• sovereign

a trade barrier that places a tax on imported goods

• quota

• embargo

• tariff

• benefit

services that can be produced most efficiently and cost effectively

• standard living

• specialization

• benefits

• trade

Quota

• unlimited amounts of goods and services trade

• limited number of services

• limit on imported goods

• unlimited imported goods

Embargoes

• free all trade with another nation

• frequently used to punish rouge states and block all trade

• giving benefits to all trade partners and rogue states

• punish only those inside the agreement

Which of the following trade barriers is a block or restriction on trade with another country.

• Tariff
• Embargo
• Quota

Which trade barrier limits the amount (quantity) of a good that can be imported?

• Subsidy
• Quota
• Tariff
• Embargo

Which statement BEST reflects the difference between tariffs and quotas?

• Tariffs raise prices on exports, while quotas set limits on imports.
• Tariffs raise prices on imports, while quotas set limits on exports.
• Tariffs raise prices on exports, while quotas set limits on exports.
• Tariffs raise prices on imports, while quotas set limits on imports.

What is the purpose of a tariff?

• To encourage people to buy goods made in their own country.
• To increase trade between other countries.
• To stop trade completely.
• To encourage democracy.