ECN U3T1 Flashcards (Detailed)

Front

Comparative advantage

Back

 The ability of a nation to produce a product at a lower opportunity cost of production than another nation

Front

Absolute advantage

Back

 The ability of a nation to produce commodities more efficiently than another nation

Front

Competitive advantage (of a nation)

Back

 Trade advantage obtained through the capacity of a nation’s industries to innovate and upgrade

Front

Imports

Back

 Goods that enter Australia from overseas

Front

External stability

Back

 The situation in which there are no unwanted movements of foreign reserves in the balance of payments

Front

Specialisation

Back

 The specific use of resources in narrowly defined economic activities

Front

Intra-company trade

Back

 Trade between affiliates of the one organisation;  for example, between a home-based subsidiary and a foreign-based subsidiary of the same company

Front

Open economy

Back

 Any nation that trades with other nations

Front

Factor endowment

Back

 The supply of the factors of production (land, labour, capital and enterprise) that exists in a country

Front

Human capital

Back

 The knowledge, experience and skills of individuals, in which nations must invest if they are to advance