Understanding Trade in Business Studies

What is the meaning of trade?

• A type of financial investment.

• A method of communication between countries.

• The process of manufacturing goods.

• The exchange of goods and services.

Name two types of trade.

• Local and International

• Import and Export

• Wholesale and Retail

• Direct and Indirect

What is the main benefit of trade?

• Limited access to foreign markets.

• Increased reliance on local goods only.

• Reduced competition and higher prices.

• Increased economic efficiency and access to diverse goods.

Define import in the context of trade.

• Import refers to the taxation of goods brought into a country.

• Import is the act of bringing goods or services into a country from abroad.

• Import is the process of manufacturing goods domestically.

• Export is the act of sending goods or services out of a country.

Define export in the context of trade.

• Export is the act of selling goods or services produced in one country to another country.

• Export is the process of importing goods from another country.

• Export is the act of donating goods to another country.

• Export refers to the transportation of goods within the same country.

How does trade benefit consumers?

• Trade limits consumer choices and increases prices.

• Trade benefits consumers by providing more choices, lower prices, and improved quality of goods and services.

• Trade reduces the variety of goods available.

• Trade has no impact on the quality of products.

What is the difference between domestic and international trade?

• Domestic trade involves exporting goods; international trade does not.

• Domestic trade occurs within a country; international trade occurs between countries.

• Domestic trade is regulated by international laws; international trade is not.

• Domestic trade is only for services; international trade is for goods only.

Why do countries engage in trade?

• To isolate their economies from global markets.

• Countries engage in trade to enhance economic efficiency and access diverse resources.

• To reduce competition among domestic producers.

• To limit access to foreign technologies.

What is a trade surplus?

• A trade surplus is a situation where a country has no trade at all.

• A trade surplus occurs when a country imports more than it exports.

• A trade surplus is when a country's imports equal its exports.

• A trade surplus is when a country's exports are greater than its imports.

What is a trade deficit?

• A trade deficit is when a country exports more than it imports.

• A trade deficit occurs when a country has a balanced trade.

• A trade deficit is when a country only exports goods.

• A trade deficit is when a country imports more than it exports.