subsidy
financial assistance to domestic producers in the form of cash
foreign trade Zone (FTZ)
designated geographic region through which merchandise allowed to pass with lower customs duties and/or fewer customs procedures
tariff
government tax levied on a product as it enters or leaves a country
ad valorem tariff
tariff levied as a percentage of the stated price of an imported product.
specific Tariff
tariff levied as a specific fee for each unit of an important product
compound tariff
tariff levied on an imported product
quota
restrictions on the amount of a good that can enter or leave a country during a certain period of time
voluntary export restraint
unique version of export quota that a nation imposes on its own exports, usually at the request of an importing nation
tariff-quota
lower tariff rate for a certain quantity of imports and a higher rate for qualities that exceed the quota.
embargo
complete ban on trade in one or more products with a particular country
administrative delays
regulatory controls or bureaucratic rules designed to impair the flow of imports into a country
currency controls
restrictions on the convertibility of a currency into other currencies.
mercantilism
trade theory that nations should accumulate financial wealth, usually in the form of gold, by encouraging exports and discouraging imports
trade surplus
condition that results when the value of nations exports is greater than the value of its imports
true deficit
conditions that results when the value of a country imports is greater than the value of its exports
absolute advantage
ability of nation to produce a good more efficiently than any other nation
comparative advantage
inability of nation to produce a good more efficiently than other nations but an ability to produce that good more efficiently than it does any other good.
factor proportions theory.
trade theory stating that countries produce and exports goods that require resources that are abundant and import goods that require a resource in short supply.