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58 Cards in this Set
- Front
- Back
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Absolute Advantage |
The ability to produce more of a given product using a given amount of resources. |
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Comparative Advantage |
The ability to produce a product most efficiently given all the other products that could be produced. |
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Law of Competitive Advantage |
The idea that a nation is better off when it produces good/services for which it has a comparative advantage. |
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Export |
A good that is sent to another country for sale. |
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Import |
A good that is brought in from another country for sale. |
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Trade Barrier |
A means of preventing a foreign product or service from freely entering a nation's territory. |
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Import Quota |
A limit on the amount of a good that can be imported. |
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Voluntary Export Restraint |
A self-imposed limitation on the number of products shipped to a particular country. |
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Customs Duty |
A tax on certain items purchased abroad. |
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Tariff |
A tax on imported goods. |
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Trade War |
A cycle of increasing trade restrictions. |
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Protectionism |
The use of trade barries to protect a nation's industries from foreign competition. |
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Infant Industry |
A new industry. |
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International Free Trade Agreement |
Agreement that results from cooperation between at least two countries to reduce trade barriers and tarrriffs and to trade with each other. |
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World Trade Organization |
A worldwide organization whose goal is freer global trade and lower tariffs. |
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European Union |
A regional trade organization made up of European nations. |
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Euro |
A single new currency that replaces individual currencies among members of the European Union |
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Free-Trade Zone |
A reigon where a group of countries has agreed to reduce or eliminate trade barries. |
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NAFTA |
Agreement that will eliminate all tariffs and other trade barries between Canada, Mexico, and the US |
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Exchange Rate |
The value of a foreign nation's currency in terms of the home nation's currency. |
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Appreciation |
An increase in the value of currency. |
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Depreciation |
The loss of the value of capital equipment that results that results from normal wear and tear OR a decrease in the value of currency |
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Foreign Exchange Market |
The banks and other financial institutions that facilitate the buying and selling of foreign currencies |
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Fixed exchange-rate system |
A currency system in which governments try to keep the values or their currencies constant against one another. |
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Flexible exchange-rate system |
A currency system that allows the exchange rate to be determined by supply and demand. |
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Trade Surplus |
The result of a nation exporting more than it imports. |
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Trade Deficit |
The result of a company importing more than it exports. |
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Balance of Trade |
The relationship between a nation's imports and exports. |
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Development |
The process by which a nation improves the economic, political, and social well-being of its people. |
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Developed Nation |
Country with a higher average level of material well-being. |
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Less Developed Nation |
Nation with a low level of material well-being |
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Per capita gross domestic product |
A nation's GDP divided by it's total population. |
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Industrialization |
The extensive organization of an economy for the purpose of manufacturing |
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Subsistence agriculture |
Level of farming in which a person raises only enough food to feed his or her family |
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Literacy rate |
The proportion of the population over age 15 that can read and write. |
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Life expectancy |
The average expected life span of an individual |
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Infant Morality Rate |
The number of deaths that occur in the first year of life per 1,000 live births |
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Infrastructure |
The services and facilities necessary for an economy to function |
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Newly Industrialized Country |
Less developed country that has shown significant improvement in the measures of development |
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Population Growth Rate |
The increase in a country's population in a given year, expressed as a percentage of the population figure at the start of the year |
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Natural Rate of Population Increase |
The difference between the birth rate and the death rate. |
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Arable |
Suitable for producing crops |
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Malnutrition |
Inadequate nutrition |
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Internal financing |
Financing dervied from the savings of a country's citizens |
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Foreign Investment |
Investment originating from other countries |
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Foreign direct investment |
The establishment of an enterprise by a foreigner |
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Foreign portfolio investment |
The entry of funds into a country when foreignere make purchases in the countrys stock and bond markets |
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World Bank |
The largest provider of development assistance |
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United Nations Development Program |
United Nations program dedicated to elimination of poverty through development |
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International Monetary Fund |
Organization formed to stabilize international exchange rates and facilitate development |
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Debt rescheduling |
Lengthening the time of debt repayment and forgiving or dismissing part of the loan |
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Stabilization Program |
An agreement between a debtor nation and the IMF in which the nation agrees to revise its economic policy |
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Privatization |
The sale or transfer of state-owned businesses to individuals |
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Work Ethic |
A commitment to the value of work and purposeful activity |
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Glasnost |
A policy of "openess" introduced into the Soviet Union in the late 1980s |
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Perestroika |
Soviet leader Mikhaul Gorbachevs plan for economic reconstruction |
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Light industry |
The production of small consumer goods |
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Special economic zones |
Designated reigons in China where foreign investment is encouraged, businesses can make most of their own investment and production decisions, and foreign companies are allowed to operate |
