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23 Cards in this Set

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1.Identify the four major types of economic flows that link the U.S. economy to those of other countries.
P92
Goods and services or trade flow
capital and labor flows or resource flows
information and technology flows
financial flows
2.How does the U.S. compare to other countries in terms of the level of its exports?
p93
More money goes out imports than comes in exports. We are only 12% of a GDP as compared to 91% by belgium.
3.a) Review trade patterns in Fig. 5-2. Which is greater? Our imports or our exports?
b) What are the major categories of U.S. exports and imports in Table 5-2? Compare the two columns for any similarities.
a) imports
B)Chemicals, petroleum
C)Aircraft, chemicals, computers, generating equipment, automobiles
4.What countries do we do most of our trading with?
p94
Canada
EU
Mexico
5.Who is our largest trading partner?
Pg94
Canada
6.What is our trade situation with China?
Pg 95
US import goods from china exceed export goods to china by 257 billion.
7.Does our dependence on foreign oil have any impact on U.S. international trade?
Pg 95
yes, the US imports 174 billion in goods (maily oil) from OPEC members and only export 49 billion to those countries
8.What is the U.S.’s largest component of exports of services?
Pg 95

Travel airlines
9.What three factors contributed to the rapid growth of international trade in the past 50 years?
Pg 95
Transportation Technology
Communication Technology
General decline in Tariffs
10.Who are the top four countries involved in world trade?
Pg 95
Germany, US, China, Japan
JUGC
11.How much have China’s exports grown in the past 20 years?
pg96
They went from a command economy to a free enterprise. Grown from 60 billion to 969 billion
12.What is an “open economy”?
Pg 96
One that includes the international sector, or you have international trade.
13.When does a country have a “comparative advantage”?
Pg 96
When you can make something cheaper in another country
14.Identify some benefits that result from specialization based upon the concept of comparative advantage.
Pg 96-97
Natural resources-
Better efficient use of the worlds natural resources both labor and product
15.What is the foreign exchange market? How are exchange rates determined?
Pg 99
Where you exchange one currency for another.
A market in which various national currencies are exchanged for one another, serves this need.
curency fluctuates in response to supply and demandin the foreign exchange market.
Fluctuates in response to suplly and demand changes
The equilibrium price.
16.What happens when currencies appreciate or depreciate?
Pg 100
Appreciation of the dollar is an increase in the international value of a dollar relative to the currency of some other nation.
Depreciation of the dollar is a decrease in the international value of the dollar relative to some other currency.
17.How do protective tariffs, import quotas, non-tariff barriers, and export subsidies differ? Who benefits or loses from each?
Pg 101
Protective tariff- are excise taxes or duties placed on import goods\\\Import quotas- are limits on the quantities or total value of specific items that may be imported\\Non-tariff barriers- include onerous licensing requirements, unreasonable standards pertaining to product quality, or simply bureaucratic hurdles and delays in custom procedures: REDTAPE
Export subsidies-consists of government payments to domestic producers of export goods.
18.What did the Smoot-Hawley Act try to achieve?
Pg 102

Reduce imports and stimulate U.S. production
19.What is GATT?
Pg 103

General Agreement on Tariff and Trade- provided a forum for the negotiation of reduced trade barriers on a multilateral basis among nations.
20.What is the World Trade Organization?
Pg 103

Oversees trade agreements reached by the member nations and rules on trade disputes among them.
21.What is the EU?
Pg 104
Regional free trade zone also called trade bloc
22.What is NAFTA?
Pg 105
North American Free trade agreement- established a free trade zone that has about the same combined output as the EU but encompasses a much larger geographic area. It eliminated tariffs and other trade barriers between Canada, mexico and the us for most goods and services
23.What is offshoring? Identify some of its economic impact.
PG 106
Shifting work previously completed by Americans to workers in other nations