PDF Notes: IT Notes

    Master this deck with 63 terms through effective study methods.

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    What is trade?

    Exchange of goods and services.

    What defines international trade?

    Trade between different countries.

    What is internal trade?

    Trade within a country's boundaries.

    What is the significance of international trade?

    It promotes economic growth and higher GDP.

    How does international trade encourage efficient resource utilization?

    Countries specialize in goods they produce best.

    What is the impact of international trade on employment?

    It generates direct and indirect jobs.

    What role does technology transfer play in international trade?

    It helps developing economies adopt modern technologies.

    How does international trade strengthen international relations?

    It promotes cooperation and reduces conflict.

    What is the effect of international trade on the standard of living?

    It raises living standards by providing access to goods.

    How does international competition affect markets?

    It improves efficiency and prevents monopolies.

    What is globalization?

    Integration of national economies through trade.

    What is the importance of economic liberalization in globalization?

    It removes restrictions on trade and investment.

    What is the Heckscher-Ohlin theory?

    Trade is influenced by the relative availability of production factors.

    What is the absolute cost advantage theory?

    Trade occurs when countries have lower production costs.

    What is the comparative advantage theory?

    Countries specialize in goods with lower opportunity costs.

    What is the significance of tariffs?

    They protect domestic industries and generate revenue.

    What are non-tariff barriers?

    Obstacles to trade other than tariffs and quotas.

    What is the balance of payments?

    A record of all economic transactions with the outside world.

    What causes disequilibrium in the balance of payments?

    Temporary changes, fundamental changes, and exchange rate fluctuations.

    What is exchange control?

    Regulation of foreign exchange transactions by the government.

    What are the merits of exchange control?

    Protects reserves and stabilizes exchange rates.

    What are the demerits of exchange control?

    Encourages black markets and reduces international trade.

    What is the foreign exchange market?

    A market for buying and selling different currencies.

    What determines the equilibrium exchange rate?

    The intersection of demand and supply for foreign exchange.

    What is purchasing power parity?

    Exchange rate determined by relative price levels.

    What is the role of the WTO?

    Promotes free and fair international trade.

    What is the purpose of GATT?

    To reduce tariffs and promote international trade.

    What is the objective of UNCTAD?

    To promote trade and development for developing countries.

    What is the significance of the IMF?

    Ensures international monetary stability.

    What is the role of the World Bank?

    Provides financial assistance for development projects.

    What is the purpose of SAFTA?

    To promote free trade in South Asia.

    What is the objective of BRICS?

    To promote economic cooperation among emerging economies.

    What is the opportunity cost theory?

    The value of the next best alternative foregone.

    What is the production possibility curve?

    Shows combinations of two goods that can be produced.

    What is the marginal rate of transformation?

    The rate at which one good can be transformed into another.

    What is trade?

    Exchange of goods and services.

    What defines internal trade?

    Trade within a country's boundaries.

    What is international trade?

    Trade between different countries.

    How does international trade impact economic growth?

    It increases income and GDP.

    What is the significance of efficient resource utilization in international trade?

    Countries specialize in goods they produce best.

    How does international trade generate employment?

    It creates jobs in various sectors.

    What role does technology transfer play in international trade?

    It helps developing economies adopt modern technologies.

    How does international trade strengthen international relations?

    It promotes cooperation and reduces conflict.

    What is the effect of international trade on the standard of living?

    It raises living standards by providing access to goods.

    How does international competition affect markets?

    It encourages efficiency and innovation.

    What is globalization?

    Integration of national economies through trade.

    What is the importance of economic liberalization in globalization?

    It removes restrictions on trade and investment.

    What is the Heckscher-Ohlin theory?

    Trade is influenced by the relative availability of production factors.

    What is the absolute cost advantage theory?

    Trade occurs when countries have a cost advantage in production.

    What is the comparative advantage theory?

    Trade is based on relative efficiency in producing goods.

    What is the purpose of tariffs?

    To protect domestic industries and generate revenue.

    What are non-tariff barriers?

    Obstacles to trade other than tariffs.

    What is the balance of payments?

    A record of all economic transactions with the outside world.

    What causes disequilibrium in the balance of payments?

    Temporary changes and fundamental shifts in the economy.

    What is exchange control?

    Regulation of foreign exchange transactions by the government.

    What are the merits of exchange control?

    Protects reserves and stabilizes the economy.

    What are the demerits of exchange control?

    Encourages black markets and reduces trade opportunities.

    What is the role of the World Trade Organization (WTO)?

    Promotes free and fair international trade.

    What is the function of the International Monetary Fund (IMF)?

    Ensures monetary stability and provides financial assistance.

    What is the purpose of the General Agreement on Tariffs and Trade (GATT)?

    To reduce trade barriers and promote international trade.

    What is the significance of the South Asian Free Trade Area (SAFTA)?

    Promotes free trade among South Asian countries.

    What is the impact of exchange rate fluctuations?

    Affects international trade and investment decisions.

    What is the purchasing power parity theory?

    Determines exchange rates based on relative price levels.