Understanding Trade, Tariffs and our Economy

Understanding Trade, Tariffs, and Our Economy

By Art Rivera

• Countries buy and sell goods with each other

• Like a giant global marketplace

• Examples: USA sells cars to other countries

• Other countries sell us toys, clothes, and food

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What is International Trade?

Multiple Choice

What is international trade?

• International trade is the exchange of goods and services across international borders.
• International trade is the sale of goods only within a country.
• International trade refers to the movement of people across borders.
• International trade is the exchange of ideas and culture between nations.

Multiple Choice

Trade helps countries get things they ___.

• do not produce themselves
• are not interested in
• have in abundance
• already produce themselves

• Goods we buy from other countries

• Think of your favorite toys from China

• Fruits from Mexico

• Cars from Japan

• These are all imports!

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What are Imports?

Multiple Choice

What are imports?

• Imports are services provided by domestic companies.
• Imports are goods and services purchased from other countries.
• Imports are local products sold abroad.
• Imports are taxes on foreign goods.

• Products we sell to other countries

• American crops like corn and wheat

• Movies from Hollywood

• Technology like iPhones

• These help our country earn money

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What are exports?

Multiple Choice

What are exports?

• Services provided for free between countries.
• Only physical products sold internationally.
• Goods and services bought by one country from another.
• Exports are goods and services sold by one country to another.

Multiple Choice

Fill in the blank: Cars from Japan are considered ______.

• imports

• exports

• local goods

• domestic products

Understanding Tariffs - Part 1

• A tariff is like a special tax

• It's added to imported goods

• Makes foreign products more expensive

• Example: A $10 toy + $2 tariff = $12 total

Understanding Tariffs - Part 2

Governments use tariffs to:

• Protect local businesses

• Raise money for the country

• Make people buy local products

• Control what comes into the country

Multiple Choice

What is a tariff?

• A tariff is a type of trade agreement.
• A tariff is a regulation on product quality.
• A tariff is a tax on imports or exports.
• A tariff is a fee for shipping goods domestically.

• When a truck of toys arrives from another country:

• The company must pay the tariff

• This cost is usually added to the price

• Customers end up paying more

• Local toy makers can sell at lower prices

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How do Tariffs Work?

Multiple Choice

A tariff is added to ______ goods.

• local
• domestic
• exported
• imported

• Local businesses can compete better

• Creates jobs in our country

• Government earns money from tariffs

• Helps protect American workers

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Effects on our economy - Positive

Multiple Choice

Governments use tariffs to ______ what comes into the country.

• control

• increase imports
• decrease exports
• eliminate trade barriers

Multiple Choice

Which of the following is a positive effect on our economy?

• Decreased job opportunities
• reduces government revenue

• Higher taxes on businesses
• local businesses can compete better

• Things cost more at the store

• Some products become harder to find

• Other countries might add tariffs to our goods

• Can make it harder to sell our products

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Effects on our Economy - Challenges

Multiple Choice

When a company pays a tariff, this cost is usually added to the price, causing customers to end up paying ____.

• less

• the same

• more

Multiple Choice

Fill in the blank: One of the challenges in our economy is that other countries might add ______ to our goods.

• import quotas
• subsidies
• tariffs
• sales taxes

• Countries try to balance imports and exports

• Like keeping money in your piggy bank

• Want to sell as much as we buy

• Helps keep our economy strong

Trade Balance

Multiple Choice

What is one of the main goals of a country's trade balance?

• to increase imports

• To increase exports

• to increase taxes

• to balance imports and exports

Global Trade Partners

Countries we trade with most:

• Canada

• Mexico

• China

• European Union

• Each relationship is important

Multiple Choice

Which of the following countries is a major trade partner?

• China
• India
• Brazil
• Germany

• Prices at your local stores

• Jobs in your community

• Products available to buy

• Your family's business or work

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How this affects you?

Multiple Choice

Which of the following is affected by changes in the economy?

• prices at your local store

• animal migration

• weather patterns

• historical events

• Trade helps countries work together

• Creates jobs and opportunities

• Makes different products available

• But needs careful management

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The Big Picture

Multiple Choice

What is one benefit of trade between countries?

• it isolates countries

• helps countries work together

• it reduces job opportunities

• limits product availability

Open Ended

What is one fact you found to be most interesting and why from the Slides?