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14 Cards in this Set
- Front
- Back
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Absolute advantage |
A country is said to have an absolute advantage in the production of a good if it can produce more of it with the same resources; or, the same amount using fewer resources |
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Administrative trade barriers (regulatory trade barriers) |
Government or administrative regulations or requirements that result in a lower level of imports into a country |
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Anti-dumpting duties |
Taxes (tariffs) that bring the import price of the good that is being dumped closer to the price charged by domestic firms in order to avoid injury to the domestic industry in the importing country |
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Appreciation |
An increase in the exchange rate within a flexible (floating) exchange rate regime |
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Balance of payments (BOP) |
A record of all transactions of a country with the rest of the world over a period of time. It is broken down into the current account, the capital account and the financial account. |
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Balance of trade |
Refers to the difference between the value of exports and the value of exports and the value of imports of goods (physical merchandise) over a period of time (sometimes services are also included) |
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Bilateral agreements |
Preferential trade agreements between two countries |
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Capital account of the balance of payments (BOP) |
An account of the BOP which records unilateral transfers of capital, such as the forgiveness of a country's debt by the government of another country as well as transfers of non-produced, non-financial assets such as natural resources, contracts, leases and licences, marketing assets (and goodwill). |
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Comparative advantage |
A country is said to have a comparative advantage in the production of good X if it can produce it at a lower opportunity cost (that is, by sacrificing fewer units of good Y) compared with another country |
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Credit item (in the BOP) |
Any item that leads to an inflow of money into a country, for example exports of goods and services or foreigners purchasing domestic bonds |
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Current account (of the BOP) |
Records the value of exports and imports of goods and services of a country in a period of time. A current account surplus exists if the value of exports of goods and services exceeds the value of imports. This applies conversely for a deficit. More precisely, the current account includes visible trade and invisibles. The latter include trade in services and net investment income as well as net transfers |
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Current account deficit |
When import expenditures on goods and services exceed export revenues over a period of time; more precisely, when the sum of net exports of goods and services plus net income from investments plus net transfers is negative |
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Current account surplus |
When export revenues exceed import expenditures on goods and services over a period of time; more precisely, when the sum of net exports of goods and services plus net income from investments plus net transfers is positive |
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Customs union |
A form of regional economic integration whereby two or more countries abolish tariffs (and other barriers) between them and establish a common external barrier towards non-member countries |
