1 / 12

Trade

List all the things that you are wearing and using right now and identify where each item was made- in the United States or in another country. Trade. Standard 8. Will you specialize in lawn mowing or babysitting?

merry
Download Presentation

Trade

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. List all the things that you are wearing and using right now and identify where each item was made- in the United States or in another country.

  2. Trade Standard 8

  3. Will you specialize in lawn mowing or babysitting? • What would you have to give up by choosing one job instead of the other? In other words, what is the opportunity cost of the choice? • Write a quick job description for each- lawn mowing and babysitting. (Write out the tasks involved in each job.) • Decide which job would be a better fit for you.

  4. Specialization • Each nation has certain resources and cannot produce everything it wants • The result is specialization- individuals or businesses produce a narrow range of products • Specialization leads to economic interdependence- a situation in which producers in one nation depend on others to provide goods and services they do not produce

  5. What are exports? • The G/S that the U.S. sells to other countries • What are imports? • The G/S that the U.S. buys from other countries

  6. Absolute advantage- the ability to produce a larger amount of a G/S than that of another trading nation • Comparative advantage- the ability to produce a G/S at a lower opportunity cost than that of another trading nation

  7. Example- Computers and Toys • The U.S. can produce 1000 computers or 5000 toys • Mexico can produce 100 computers or 1000 toys • U.S. has AA in BOTH computers and toys • Which country has a CA in computers and which has a CA in toys?

  8. What is given up/what is gained • U.S. • OC of Computers: 5 toys/1 computer • OC of Toys: 1 toy/5 computers • Mexico • OC of Computers: 10 toys/1 computer • OC of Toys: 1 computer/10 toys

  9. OC to produce computers in the U.S. is lower than Mexico- U.S. should specialize in computer production • OC to produce toys in Mexico is lower than the U.S.- Mexico should specialize in toys

  10. Trade Barriers • Offer some short-term protection to jobs and industries located within their borders • Quotas- limits on the amount of a product that can be imported • Tariffs- fees charge for goods brought into a country from another country

  11. Balance of trade- the difference between the value of its imports and exports • Balance of payments- a record of all the transactions that occurred between the individuals, businesses, and government units of one nation and those of the rest of the world

  12. Regional and World Trade Organizations • European Union (EU) • North American Free Trade Agreement (NAFTA)- U.S., Canada and Mexico • World Trade Organization (WTO)

More Related