International Trade

What is international trade?

• A type of trade that occurs only in the European Union

• The purchase and sale of goods and services by companies in different countries

• The exchange of goods and services between individuals only

• The purchase and sale of goods and services within a single country

What does international trade allow countries to do?

• Focus solely on the production of technology

• Limit their market to domestic goods only

• Increase the cost of goods for consumers

• Expand their markets and access goods and services that may not have been available domestically

What is a key takeaway from the text regarding global trade?

• It gives consumers and countries the opportunity to be exposed to goods and services not available in their own countries

• It ensures that all countries have the same level of technology

• It restricts countries to trade within their own borders

• It decreases the variety of goods available to consumers

What is the theory of comparative advantage?

• A theory that discourages international trade

• A theory that suggests countries should only produce goods they can make at the highest quality

• A theory that suggests countries should produce and export goods they can make most efficiently and import goods they cannot

• A theory that supports the idea of complete self-sufficiency of a country

What is an example of comparative advantage given in the text?

• China's advantage in producing technology over the United States

• The United States' ability to produce all goods more efficiently than any other country

• Portugal's low-cost wine production compared to England

• Brazil's exclusive production of coffee

What can be a criticism of comparative advantage?

• It encourages countries to stop producing essential goods

• It leads to a decrease in global trade

• It ensures equal wealth distribution among countries

• It can result in rent seeking and protectionist policies

What is a common barrier to international trade?

• Comparative advantage

• Globalization

• Tariffs, subsidies, and quotas

• Free trade agreements

What does free trade aim to achieve?

• Reduce the efficiency of global markets

• Focus trade only on technology products

• Eliminate all restrictions on trade

• Increase government intervention in trade

What is the role of protectionism in international trade?

• To eliminate all forms of trade barriers

• To deregulate the global market

• To promote free trade without restrictions

• To regulate international trade to correct market inefficiencies

What was the U.S. international trade deficit in September 2023?

• $61.5 million

• $615 billion

• $61.5 billion

• $615 million