2698647
Description
Flashcards by Milikani Moyo, updated more than 1 year ago
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Created by Milikani Moyo
almost 9 years ago
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| Question | Answer |
| Net trade | the balance of trade in goods and services. it is the main component of the current account (X-M) |
| Competitiveness | the price of UK exports compared to other countries products |
| Bloc | a group of countries who unite for trade e.g. EU |
| Trade Bloc | a group of countries who agree to reduce trade barriers on each others exports e.g. by eliminating tariffs and quotas |
| Economic Integration | the process of blurring the boundaries that separate economic activity in one nation state from that in another |
| Trade creation | when high cost domestic producers are replaced by low cost imports from efficient partner countries during integration |
| Trade Diversion | when economic integration results in low cost producers outside the integrated area being replaced by high cost producers in partner nations |
| Trade Barriers | barriers and restrictions on the import or export of products |
| Terms of Trade | the price of a country's exports relative to the price of its imports. the terms of trade can be measured using the formula: ToT = index of average X prices/ index of average M prices * 100 |
| Unit Labour Costs (ULC) | the cost of labour per unit of output, includes the social cost of employing labour as well as the wage costs |
| Protectionism | government policies that create barriers to trade e.g. tariffs and quotas |
| Productivity | the amount of output created per unit input used |
| Productivity Gap | the differences in productivity levels between different countries |
| Productive Efficiency | when productivity is maximised from given inputs. this means products are made at the lowest possible unit costs (MC=AC) |
| Supply Side Policy | government measures designed to increase productive capacity and so increase aggregate supply |
| Foreign Direct Investment (FDI) | a multinational in one economy acquires a lasting interest in a business in another economy, international investment |
| Free Trade | an agreement between 2 or more countries to abolish tariffs in the new bloc |
| Multinational corporation (MNC) | a firm that operates in more than one country |
| Flexible Labour Market | a labour market that adjusts quickly and smoothly to changes in the demand for and supply of labout |
| World Trade Organisation (WTO) | an international body responsible for negotiating trade agreements and 'policing' the rules of trade to which its members sign up. Trade disputes between members are settled by the WTO |
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