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24 Cards in this Set
- Front
- Back
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Globalisation
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Rapid expansion of world trade in goods and services leading to greater international interdependence
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Multinational company
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A company that has its headquarters in one country but operations all over the world - they are very big organizations for example: Ford, Toyota, Shell, BP and Microsoft
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Specialisation
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Being better than another country at producing a good or service, in terms of the quantity of output and lower costs
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Absolute advantage
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When a country is able to provide a good or service using fewer resources and at a lower cost than another country
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International Trade
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Exchange of goods and services across international boundaries
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Free trade
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Absence of tariffs, quotas and regulations designed to reduce or prevent trade amongst nations
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Export
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Goods and services which UK firms provide and sell to people and firms not resident in the UK and results in money coming into the UK
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Imports
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Goods and services provided by firms based overseas to residents of the UK which results in money leaving the UK economy and any money spent abroad is an import
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Protectionism
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Where an action is taken that reduces international trade
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Tariff
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A tax placed on imports to increase the price and reduce the quantity demanded. This makes foreign imports more expensive
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Embargo
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This is a ban on the import of goods or services
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Quota
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A physical limit on the number of goods imported or it could be percentage of total market
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Current account of the balance of payments
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The balance of trade in goods and services plus net investment income from overseas assets
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Balance of trade in goods
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The export of goods from the primary and secondary sectors minus the imports of these goods
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Balance of trade in services
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The exports of tertiary sector services minus the imports of these services
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Balance of payments deficit
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Value of imports exceeds that of exports so there is an outflow of money
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Balance of payments surplus
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Value of exports exceeds that of imports so there is an inflow of money
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Exchange rate
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How much of one currency needs to be given up to buy one unit of another currency - rate at which one currency exchanges for another currency
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Floating exchange rate
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Where price of two currencies are decided by market forces
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Fixed exchange rate
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Where the central bank of a country decides on the price of a currency
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International competitiveness
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Ability of companies to compete with companies from other countries
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Foreign direct investment
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Investment by foreign companies in the production of goods and services
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Absolute poverty
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A person has insufficient income to live on, it can be measured by adding up the cost of basic essentials such as food, clothing and shelter. On a world basis it is defined as having less than $1.25 a day to live on
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Relative poverty
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60% of median income
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