the ability to produce a specific product more efficently that any other nation
comparitive advantage
the ability to produce a specific product more efficently than any other product
balance of trade
the totl value of its exports minus the total value of its imports over some period of time
trade deficit
a negative balance of trade
balance of payments
the total flow of money into a country minus the total flow of money out of that country over some period of time
import duty
a tax levied on a particular foreign product entering a country
dumping
exportation of a large quantities of a product at a price lower than that of the same product in the home market
nontariff barriers
a nontax measure imposed by a government to favor domestic over foreign suppliers
import quota
a limit on the amount of a particular good that may be imported into a country during a given period of time
embargo
a complete halt to trading with a particular nation or in a particular product
foreign-exchange control
a restriction on the amount of a particular foreign currency that can be purchased or sold
currency devaluation
the reduction of the value of a nations currency relative to the currencies of other countries
reasons for trade restrictions
to equalize a nations balance of payments, to protect new or weak industries, national security, the health of citizens, and to also protect domestic jobs
reasons against trade restrictions
higher prices for consumers, restriction of consumers choices, misallocation of international resources, loss of jobs
General agreement on tarrifs and trade (GATT)
an international organization of 153 nations dedicated to reducing or eliminating terrifs and other barriers to world trade
world trade organization(WTO)
established in the uruguay rounds; powerful succesor to GATT that incorporates trade in goods, services, and ideas
economic community
an organization of nations formed to promote the free movement of resources and products among its members and to create common economic policies
licensing
a contractual agreement in which one firm permits another to produce and market its products and use its brand name in return for a royalty or other compensation
letter of credit
issued by a bank on request of an importer stating that the bank will pay an amount of money to a slated benificiary
Bill of lading
documents issued by a transport carrier to an exporter toprove that merchandise has been shipped