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Flashcards in Quiz 4 Deck (48)
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1

Why do nations trade ?

We are lacking in resources, higher in profit

2

Define opportunity cost

The most desirable alternative given up as a result of a decision

3

What is an export ?

Putting out goods to other countries

4

What is an import ?

Something we get from other countries

5

What country is the largest importer ?

United States

6

What country is the largest exporter ?

United States

7

What are the three most common trade barriers ?

Import quotas
Voluntary export restraint (V.E.R)
Tariffs

8

Define Tariffs

Tax on imported goods

9

What is a trade war ?

A cycle of increasing trade restrictions

10

Define protectionism

The use of trade barriers to protect a nations' industries from foreign competition

11

Does the US have a trade surplus or trade deficit ?

Trade deficit

12

Why are we in a trade war with China ?

Exporting to many goods at cheap prices

13

Natural resources

Land

14

Human resources

Labor

15

Human capital

Knowledge and skills gained by working through education and experience

16

Absolute advantage

The ability to produce more of a given product using all the other products that could be produced

17

Comparative advantage

The ability to produce a product most efficiently given all the other products that could be produced

18

Trade barrier

A means of preventing a foreign product or service from freely entering a nation's territory

19

Competition

Markets that set prices

20

Import quota

A limit on the amount of a good that can be imported

21

V.E.R

Limited exports to a specific country

22

Tariffs

Tax on imported goods

23

Why we have import quotas

Protect U.S manufacturing
Protect consumers
Protect prices

24

Why do we have V.E.R. ?

So another country won't put up a trade barrier

25

Trade surplus

The result of a nation exporting more than its imports

26

Trade deficit

The result of a nation importing more than its exports

27

Who is the number one producer of oil in the world ?

America

28

Who owns the oil ?

Business

29

What is shale ?

Fracking

30

Who has the largest reserve of shale oil ?

Texas