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what does it mean when an economist says that an area specializes in producing certain products? |
they only make certain products rather then everything they need |
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suppose the exchange rate between the us and japan change from $1=100 yet to $1 = 110 yen. what would happen to the prices of American goods in japan? |
they will increase |
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how do countries protect their domestic economy from excessive influence by multinational corporations? |
by requiring multinational to export a certain percent of its products |
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what happens when a nation’s currency depreciates? |
products become cheaper to other nations |
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when the exchange rates are allowed to be determined by supply and demand, they are called…? |
free market |
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what is the european union? |
regional trade organization of european nations |
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what is an advantage for the host country of a multinational corporation? |
greater employment opportunities |
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what is th ename of a treaty whose purpose is to eliminate all trade barriers between canada, mexico, and the united states? |
NAFTA |
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ecuador has a comparative advantage in the production of bananas over the US because of this, what can be said about ecuador and the united states? |
Ecuador can produce bananas cheaper then the US |
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according to the law of comparative advantage, a country should? |
specialize and export goods with lowest opportunity cost |
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if a nation has normal trade relation status, then exports from that country… |
are taxed at same rate as other nations with same ntr status |
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you are returning from europe and decide to buy some chocolates in a duty-free shop at london-heathrow airport. What does "duty free" mean? |
no import tariffs |
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the US has placed a limit on the number of cars that can be brought into the country for sale. This is an example of…? |
import quota |
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specialization in a nation leads to..? |
international trade |
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suppose there is a balance of trade in both the US and canada. Then, the US dollar appreciates against the Canadian dollar. what would the likely outcome be? |
trade surplus in canada |
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duty free shops in airports or on international boats sell merchandise that can be brought into the country without what? |
import taxes |
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what economic status can the US grant to countries that allows them to pay the same tariffs as other countries wiht the same status? |
most favored nation |
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US industries like steel, computers, and energy need to be protected from foreign competition to ensure what? |
balance of trade |
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when a nation imports more then it exports, economists say it has what? |
trade deficit |
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what is a currency system in whcih each country tries to keep the value of its currency constant against one another called? |
fixed exchange rate system |
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what does a "most favored nation" status mean? |
country pays same tax rate as all others as long as they’re with the same agreement |
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what is a major disadvantage in the use of import barriers to make domestic goods cheaper? |
domestic manufacturers may lose economic incentive to become more efficient |
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what is an infant industry? |
young developing industry |
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in which customs union did the 12 member nations replace their individual currencies with the Euro in 2002? |
european union |
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protectionism… |
sheilds infant industries, fosters competition, and promots industries |
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the marshall plan… |
loaned money to European countries to rebuild after ww2 |
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the largest provider of development assistance is? |
world bank |
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brain drain is..? |
where smart people move away |
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factors such as life expectancy, energy consumption, per capita GDP, literacy rates, and infant mortality rates are used to ..? |
measure development of a country |
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suppose a less developed country is having difficulty making payments on its foreign debts. what option does this nation have? |
ask leaders for debt reschedueling in exchange for accepting stabilizations program for international monetary fund |
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in 1973, members of OPEC reduced oil exports, which mor ethen quadrupled oil prices. What effect did that have on less developed nations? |
had to borrow money to buy oil, which incrased debt and made it impossible to repay foreign loans |
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