International Unit Bellringer #1

Buying and selling goods across borders

• International Trade

• Protectionism

• Absolute Advantage

• Free Trade

Occurs when a country can produce a good utilizing less resources than another country

• Absolute Advantage

• Comparative Advantage

• Free Trade

• Balance of Trade

Occurs when a country can produce a good at a lower opportunity cost than another country

• Absolute Advantage

• Comparative Advantage

• Free Trade

• Balance of Trade

Government policies that restrict trade

• Trade Barriers

• Free Trade

• Trade surplus

• Trade deficit

What is MOST LIKELY to happen to US imports and exports if the US dollar appreciates relative to other currencies?

• imports will decrease, exports will increase

• both imports and exports will increase

• imports will increase, exports will decrease

• both imports and exports will decrease

Assume the United States has an absolute advantage over Singapore in the production of all goods. Which statement about trade possibilities between the two countries is correct?

• The terms of trade will be based on the United States absolute advantage.

• They can still arrange a beneficial trade if each one focuses production on a good in which they have a comparative advantage.

• Since the United States has an absolute advantage in all goods, it is impossible to reach a trade agreement.

• Singapore could benefit from a trade with the United States, but the United States would not benefit.

Limitation on the quantity of products allowed to be imported into a country

• Tariff

• Subsidy

• Embargo

• Quota

• Standard

A refusal to trade with a country; imposition of economic sanctions

• Tariff

• Quota

• Embargo

• Subsidy

• Standard

How much the currency of one nation is worth compared to the currency of another nation

• Exchange Rate

• Standard of Living

• Purchasing Power

• Standards

Which group benefits when the US dollar depreciates (weak dollar)against other currencies?

• US citizens traveling in foreign countries

• Foreign governments with US Treasury Bonds

• Foreign citizens vacationing in the US

• US citizens buying foreign goods and services