Download Bell Ringer

Bell Ringer
List products that you are able to enjoy
because the United States allows
international trade with other countries.
Chapter 6.1 International trade
The Global Marketplace
What You’ll Learn
The interdependence of nations.
 The benefits of international trade.
 How government is involved in
international trade
 What balance of trade is
 What trade barriers are
 The significance of trade agreements and
alliances

Defining International Trade

International trade involves the
exchange of goods and services between
nations.

Imports – goods and services purchased
from other countries.

Exports – goods and services sold to
other countries.
Interdependence of Nations

Absolute Advantage – when a country
has special natural resources or talents
that allow it to produce an item at the
lowest cost possible.

Comparative Advantage – the value
that a nation gains by selling the goods
that it produces most efficiently.

Benefits
Government Involvement in
International Trade

Balance of Trade – trade surplus,
difference in value between exports and
imports of a nation.

Trade Barriers:
◦ Tariffs – a tax on imports
◦ Quotas – monetary value of a product that
may be imported
◦ Embargoes – a total ban on specific goods
coming into and leaving a country
Trade Agreements and Alliances

The World Trade Organization (WTO) – a
global coalition of 135 governments that makes
the rules governing international trade.

North American Free Trade Agreement
(NAFTA) – an international trade agreement
among the United States, Canada, and Mexico.

European Union (EU) – Europe’s trading bloc.
The goal of EU is to encourage economic
integration as a single market.
Quiz
1.
2.
3.
4.
5.
True or False. The International Trade involves the
exchange of goods and services between nations.
True or False. Government involvement in
International Trade is based on balance of trade,
trade barriers, and trade agreements and alliances.
True or False. The World Trade Organization is a
global coalition of 135 governments that makes the
rules governing international trade.
True or False. North American Free Trade
Agreement in a national trade agreement.
True or False. The European Union goal is to
encourage economic integration as a single market.