Chapter 14 - International trade. After reading the material in this chapter, you should be able to: Explain why global trade has increased so much in recent years, summarize the main gains to trade, compare and contrast absolute advantage and comparative advantage, discuss the winners and losers from trade and analyze the arguments for protectionism. | Chapter 14 International Trade McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved. Learning Objectives Explain why global trade has increased so much in recent years. Summarize the main gains to trade. Compare and contrast absolute advantage and comparative advantage. Discuss the winners and losers from trade and analyze the arguments for protectionism. Describe what it means for a currency to appreciate or depreciate. List explanations for why the United States consistently runs a trade deficit. 14- Nature of International Trade There has been a boom in international trade over the last decade. Both trade in goods and services has been soaring. Service exports include such items as foreign students studying in the . and foreigners watching TV shows and movies. 14- Global Exports (and Imports) as a Percent of Global GDP 14- Top Ten Purchasers of . Exports 14- Top Ten Sources of . Imports 14- Barriers to Trade Historically, businesses that want to sell to buyers in another country faced both the natural barriers to trade and the legal barriers to trade. The natural barriers include distance, differences in culture and values, and the difficulty of delivering services remotely. The legal barriers include tariffs, quotas, and other regulatory impediments. 14- Barriers to Trade Both natural and legal barriers to trade have fallen due to technology and a commitment among countries toward a policy of free trade. Technology has reduced the cost of shipping and made communication over long distances much easier. The ease of communication has reduced problems associated with different languages and cultures. 14- Lowering of Legal Barriers Historically, countries have put barriers on trading in the form of tariffs and quotas. Tariffs are the taxes leveled on imports by a country. Quotas are numerical limits on the number of imported products coming into a country. Tariffs . | Chapter 14 International Trade McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved. Learning Objectives Explain why global trade has increased so much in recent years. Summarize the main gains to trade. Compare and contrast absolute advantage and comparative advantage. Discuss the winners and losers from trade and analyze the arguments for protectionism. Describe what it means for a currency to appreciate or depreciate. List explanations for why the United States consistently runs a trade deficit. 14- Nature of International Trade There has been a boom in international trade over the last decade. Both trade in goods and services has been soaring. Service exports include such items as foreign students studying in the . and foreigners watching TV shows and movies. 14- Global Exports (and Imports) as a Percent of Global GDP 14- Top Ten Purchasers of . Exports 14- Top Ten Sources of . Imports 14-
