After reading this chapter, you should be able to: Explain how gross domestic product (GDP) is defined and measured; describe the relationships among GDP, net domestic product, national income, personal income, and disposable income; discuss the nature and function of a GDP price index, and describe the difference between nominal GDP and real GDP; list and explain some limitations of the GDP measure. | International Trade Chapter 24 Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. In this chapter we will take a look at some key facts about international trade and then start evaluating international trade using comparative advantage. We will also use demand and supply curves to explain how countries determine which goods they will import, which goods they will export, and the price that is charged for these goods. Lastly we will look at trade barriers and how they impact the outcomes of international trade. Some Key Trade Facts . trade deficit in goods $735 billion in 2012 . trade surplus in services $196 billion in 2012 Canada largest . trade partner Trade deficit with China $315 billion in 2012 Exports are 14% . output Dependence on oil LO1 LO1 International trade is a key component in most nations’ economies. It is what allows countries to grow. Without it, a . | International Trade Chapter 24 Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. In this chapter we will take a look at some key facts about international trade and then start evaluating international trade using comparative advantage. We will also use demand and supply curves to explain how countries determine which goods they will import, which goods they will export, and the price that is charged for these goods. Lastly we will look at trade barriers and how they impact the outcomes of international trade. Some Key Trade Facts . trade deficit in goods $735 billion in 2012 . trade surplus in services $196 billion in 2012 Canada largest . trade partner Trade deficit with China $315 billion in 2012 Exports are 14% . output Dependence on oil LO1 LO1 International trade is a key component in most nations’ economies. It is what allows countries to grow. Without it, a nation might not have access to a key resource or a way to exchange its own key resources for other items needed. The . economy has thrived on international trade throughout its history. In one sense, the . was founded on the very basis of international trade as Christopher Columbus discovered the new world while looking for a new route to engage in international trade. We can understand why Canada is our largest trading partner given the fact that we share a lengthy border that facilitates trade. The trade deficit with China has been decreasing in recent years as their economy grows, providing the citizens with more disposable income with which to purchase imported items coming from the . Our dependence on foreign oil still causes concerns in many sectors because if the supply was disrupted for any reason, it could cause severe supply shocks in the economy. Some Key Trade Facts Principal . exports include: Chemicals Agricultural products Consumer durables Semiconductors .
