4.1 Flashcards
Indicators of growth
- GDP per capita
- literacy
- health
- human development index (life expectancy, years of schooling, gross national income per capita)
Exports
The selling of goods and services to other countries
Imports
The buying of goods and services from other countries
Balance of payments
Exports - imports
Factors affecting imports and exports
- exchange rates
- PED
- the state of the world economy
Specialisation
When economic units concentrate on producing specific goods or service. -> increased productivity due to division of labour
Foreign direct investment
Investment made by a business or from one country into assets within another
Globalisation
The process of greater integration and interconnectedness between countries
Factors contributing to globalisation
- reduction of trade barriers/ trade liberalisation
- political change
- reduced cost of transport and communication
- increased significance of global companies
- increased FDI
Protectionism
When a country takes action to protect its own industries by restricting trade with other countries
Tariffs
Taxes placed on imported goods that are not applied to domestic goods
Quotas
A physical limit on the volume of imports entering a country
Embargoes
A total ban on imported goods
Trade blocs
When the governments of a group of countries agree to trade together freely
