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NZ top exports
dairy prouducts
meat
timber
crude oil
NZ to imports
pertol
mechanical equpiment
vehicles
electrical equiment
NZ top export contries
austrailia
china
USA
japan
NZ top import
China
Australia
USA
Japan
Absoulte advantage
who ever has the abilty to produce at the lowest unit cost efficentcy
comparative advantage
who can proudes at the lowest opportunity cost
off shore
are goods and services sold overseas users out side of new zealand
onshore
sold to overseas people but consumed in nz
How do you work out opportunity cost
sacrifice deived by gain
Balance on goods is
exported goods - imported goods
balance on services is
exported serives - imported services
balance on investment income
income from investments aboard - investments from foreign invesments
balance on current transfers
inflows of current transfers - out flow of current transfers
Current account is...
balance of goods
+ balance of services
+ Balance on investment income
+ balance on transfers
Why is trade important to NZ economy
because we depend on critical imports such as oil to keep the econmoy working at its current standard
NZ producer worse off
less money
will need less workers or fewer hours for workers
may switch production
reduced investment
Nz producers better off
more income
more workers or more hours for workers
may stop prduceing less profitable goods
increased investment
NZ consumers worse off
have to pay more
standard of the g+s lower as best gets exported
NZ consumers better off
get to pay less
NZ Government worse off
less tax paid because less profit
less income tax
more U/E = more benifts
less govt spending
less indirect tax = no one spending
NZ Government better off
more tax paid more profits
more income tax
less U/E = less welfare benfits
more govt spending
more indriect tax because more spending
Overseas customers worse off
less goods revived as imports prices will rise
overseas customers better off
more goods revived as imports
prices will fall
NZ exchange rate worse off
Nz dollar falls
fewer goods exported
less demand for nz dollar
NZ exchange rate better off
NZ dollar rise
more goods exported
more demand for NZ dollar
Balance of payments worse off
less goods exported there fore exports decrease so net exports will decrease ( exports - imports = net exports)
Balance of payments better off
more goods exported there fore exports increase so net exports will increase ( exports - imports = net exports)
Tariff benefits ....
NZ producers of imported goods
employees at those products
the Govt. as it receives revenue from from the tariff e.g. more income tax less beifits
Tariff disadvantages
exporters who have to face higher tariffs from trading partner in relation for tariffs on imported goods into NZ
employees in the export industries
consumers as the price goes up my the amount of the tariff
impact if an tariff is removed
NZ consumer cheaper and more wider range in imported goods
employees in that industries may lose there job
some firms may shut down
other exporting firms may benefit as cheaper to produce, less competition
Govt. will lose from revenue from tariff
the supply of the NZ$ in the foregin exchange market increase when
imports increase
NZ travel over seas
interest rates overseas increase
the NZ economy seems to be weakling relative to overseas economies
deprecation in the exchange rate
COPTSPORGITGST
cost of production
taxes
subsidies
price of related goods
import taxes/ trariffs
GST
the demand for NZ$ in the foreign exchange market increase when..
exports increase
overseas people travel to NZ
NZ economy seems to be strenthing retaliative to overseas economies
an increase in demand would cause a appreciation of the exchange rate
Aggregate supply is
COPTSPORGITGST
Author
jessical
ID
243583
Card Set
Economics
Description
revision for test
Updated
10/29/2013, 7:54:43 PM
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