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What does both imports and exports include?
Goods and Services
The goods and services that countries buy from other
countries are called what?
The goods and services that a country sales to people in
other countries are called?
U.S. exports and imports are mainly what?
The single largest trading partner with the U.S. is whom?
When an American goes to study in a foreign university
what is that student doing?
Importing services to the U.S.
If a French student enrolls and pays tuition at Harvard
what is this called?
Increase in U.S. exports
An example of a service imported by the U.S. is what?
- An American traveling on Air France to the France tennis
What is net exports?
The value of exports minus the value of imports.
When the U.S. exports are negative, U.S. exports
are than U.S. imports and the U.S.
Smaller, Borrowing from
What is opportunity cost measured by?
The slope of the production possibility frontier curve.
The PPF for a country slopes , which
Downward, opportunity cost
A country has a comparative advantage in producing a
good if in comparison to any other country it can produce that good how?
At a lower opportunity cost.
When trade between two countries occurs what is the
- Both countries gain because both can consume both than
The gain from trade enables a country to do what?
Consume outside its PPF curve.
Nations can increase consumption of all goods if they do
Produce the goods in which they have a comparative advantage and trade with other nations.
The U.S. both exports and imports cars why?
- Diversity of taste allows other countries to demand U.S.
- cars while U.S. consumers demand foreign cars.
Economies of scale exist if an increase in production
Average total cost
What is a tariff?
Tax imported goods or services
What is the purpose of the tariff?
What is any action other that a tariff, that restricts
During the great depression in the 30’s, what was the
average tariff level?
Today the U.S. has a tariff rate of what?
An important international trade agreement signed after
WWII is called what?
General Agreement on Tariffs and Trade
What does the WTO stand for?
World Trade Organization
The U.S. has a free trade agreement with whom?
Canada and Mexico
Under which agreement will barriers to international
trade between the U.S., Canada, and Mexico be virtually eliminated after a 15
year phasing end period which began in 1994?
North American Free Trade Agreement
What is a quota?
Quantitative restriction on a particular good
The most efficient way to maintain the output of an
industry necessary for a national defense is what?
What is dumping?
Occurs when a foreign firm sales its exports at a lower price than cost to produce it.