Cornerstone Task 2

goods and services PURCHASED from other countries

• 
  Imports

• Absolute Advantage

• Exports

• Comparative Advantage

goods and services SOLD to other countries

• 
  Imports

• Absolute Advantage

• Exports

• Comparative Advantage

occurs when a country possesses unique resources or capabilities allowing for the lowest cost of production for a product

• 
  Imports

• Absolute Advantage

• Exports

• Comparative Advantage

occurs when a country is able to produce a product more efficiently and at a lower cost than another country

• 
  Imports

• Absolute Advantage

• Exports

• Comparative Advantage

French word for ‘leave alone’; economic concept opposing governmental involvement in commerce beyond what is necessary to keep an economic system running on its laws; associated with a free enterprise system.

• Laissez-faire

• Absolute Advantage

• Import

• Exports

tax on imports

• 
  Tariff

• Protective Tariff

• Revenue-producing Tariff

• Quota

limits the quantity or monetary value of an import; controls the level of an import

• 
  Tariff

• Protective Tariff

• Revenue-producing Tariff

• Quota

complete ban on certain products coming in or leaving the country; usually put in place for political reasons

• Embargo

• Revenue-producing Tariff

• Quota

• Protective Tariff

global coalition among many countries; headquartered in Geneva, Switzerland

• World Trade Organization (WTO)

• 
  European Union (EU)

• North American Free Trade Agreement (NAFTA)

trade alliance among 28 European nations; encourages free trade among members and promotes work as a single market

• European Union (EU)

• North American Free Trade Agreement (NAFTA)

• 
  World Trade Organization (WTO)