3.3: International Trade Flashcards
3.3.1: International Trade (19 cards)
What is protectionism in international trade?
A government policy to restrict trade to protect local businesses and jobs, using tools like tariffs, quotas, and subsidies.
What does international trade involve?
The buying and selling of exports and imports of goods, services, and capital between countries.
The buying and selling of exports and imports of goods, services, and capital between countries.
List three key reasons for international trade.
Efficiency, product differentiation, and greater consumer choice.
How does product differentiation promote trade?
Differences in features, branding, or quality make foreign products attractive even when local alternatives exist.
What are three benefits of international trade for a country? and Name two drawbacks of international trade.
Job creation, economies of scale, and spreading market risk. However there is a risk of dependency and environmental impact from increased transport.
What is the main goal of protectionism?
To protect domestic industries by restricting imports using tariffs, quotas, or trade restrictions.
How do quotas protect domestic suppliers?
By limiting the quantity of imports, increasing demand for local goods, but often raising prices for consumers.
Why might a country impose protectionist measures?
To protect infant industries, prevent dumping, and safeguard domestic jobs.
List two benefits of free trade.
Greater consumer choice and increased competition, leading to lower prices and better quality.
Name one benefit and one drawback of trade blocs.
Benefit: Increased trade between members. Drawback: Can distort global trade and exclude efficient external producers.
How does a single market differ from a free trade area?
It includes free movement of goods, services, capital, and people, and applies a common external tariff.
List three benefits of free trade and Why is free trade sometimes criticised?
Economies of scale, innovation, and political stability however it may benefit rich nations more, exploit poor countries, and concentrate power in large multinationals.
What are two challenges businesses face in international trade?
Currency exchange fluctuations and cultural differences in consumer preferences.
What is consumer boycotting and give an example?
Refusing to buy from certain brands due to ethical or political reasons; e.g., boycotts of Starbucks over Israel-Palestine conflict.
What are three benefits for UK firms expanding internationally?
New markets, economies of scale, and premium pricing for British brands.
Name four methods firms use to expand internationally.
Exporting, joint ventures, setting up overseas bases, and franchising
What is global branding?
Using the same brand name, image, and strategy worldwide to achieve consistency and scale.
What is glocalisation?
Adapting global brands to local tastes and cultures while maintaining core brand identity.
List three challenges UK firms face when entering foreign markets.
Cultural differences, exchange rate risks, and different laws/regulations.
