Exam #3 Flashcards
Absolute Advantage
Overall production of who can produce more opportunity goods
Comparative Advantage
2 countries can both benefit from trade even when one can produce more cheaply than the other
Invisible Hand
Decentralized markets efficiently produce goods and services and get them to consumers
Trade Adjustment Assistance (TAA)
Money for people who lost jobs due to foreign competition
“Do no direct harm”
A principle that people are hurt by economic decisions out of their control
Protectionism
The practice of shielding a country from foreign imports
Tariff
A tax imposed by the govt on imports from another country
Monopoly
The exclusive control of the supply, production, and trade of a good/service
Capitalism
An economic and political where a country’s trade is controlled by private owners for profit.
Gold Standard
Monetary system where a country’s currency has a value linked to gold
Bretton Woods
The Conference led by the US where leaders created a framework to govern international and monetary trade with institutions (e.g. GATT, IMF, World Bank)
General Agreement on Tariffs and Trade (GATT)
International agreement to reduce tariffs/other trade restrictions
Free Trade
Flow of goods and services without restrictions
World Bank
An international organization that works to reduce poverty in developing economies
IMF
An international organization that handles global monetary matters across the world and in its member countries
WTO
An international organization that regulates and facilitates trade between nations
RTA
A treaty between 2+ governments that defines the rules of trade for all signatories
Trade Follows the Flag
Economics and trade align with a country’s geopolitical strategy
Sanction
A restriction of a country’s economic ability
Mercantilism
Economic system where trade serves the interest of the state and protects manufacturers
