International Trade and Money Questions and Answer (Distinction Level) 2023

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When does trading occur? - -When consumers in the US buy goods from other nations (imports) and businesses in the US sell goods to other nations (exports). -What are the benefits of world trade? - ... -• Jobs • Profits • Variety of goods and services. -What affects the importing and exporting a nation does? - -Absolute and comparative advantage. -What is absolute advantage? - -When a nation can produce much more of a good or a service than another nation; nation has more factors of production. Nations tend to produce more of products in which an absolute advantage exists. -What is comparative advantage? - -When a nation can produce a good or service at a lower opportunity cost. Nations still tend to produce more of these products. Nations benefit when each country concentrates on production of a product in which it is efficient in. [Show More]

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