Specialization and Trade

Read the text and answer the question. Colombia and the United States are trading partners. The United States exports agricultural goods and manufactured goods to Colombia. Colombia specializes in cut flowers, gold, and coffee. What would happen if the United States placed an embargo on Colombia?

• the price of coffee and cut flowers from Colombia would go up

• the price of coffee and cut flowers from Colombia would go down

• people in Colombia would not be able to sell coffee or cut flowers to other countries

• people in the United States would not be able to buy coffee or cut flowers from Colombia

How did the North American Free Trade Agreement increase economic cooperation between Canada, Mexico, and the United States?

What do some see as a negative consequence for Mexico that was caused by entering into the North American Free Trade Agreement?

• Many Mexicans lost their jobs in agriculture.

• The price of most consumer goods increased.

• Many service jobs were outsourced to the United States.

• Trade between Mexico and Canada declined significantly.

What do some see as a negative consequence for the United States that was caused by entering into the North American Free Trade Agreement?

• Many Americans lost their jobs in agriculture.

• The price of most consumer goods increased.

• Many manufacturing jobs were outsourced to Mexico.

• Trade between the United States and Europe declined.

focusing or concentrating on a specific range of products and services that can be produced in a cost effective and efficient way

• specialization

• voluntary trade

• mutually beneficial

• prosperity

• self-sustaining

Which is the best description of specialization?

• voluntary trade

• having many trade relationships

• offering free trading

• focusing on a range of products that are readily available

Read the scenario and choose the correct trade barrier:

Canada enforced a limit of knit fabric imports from China

• Tariff

• Quota

• Embargo

How should a country produce goods and services to trade?

• Cheaply

• Quickly

• Cost effective and efficiently

• Inefficiently

Which is the best description for voluntary trade?

• A market where buyers have all the power

• A market where sellers have all the control

• A market where buyers and sellers have the right to trade freely

• A trading system where people volunteer in factories to keep costs down

Read the scenario and choose the correct trade barrier:

Canada added a new tax on all coffee products from Columbia

• Tariff

• Quota

• Embargo