, International Trade
WHY DO COUNTRIES TRADE
when they do not have the resources or capacity to satisfy their own needs and want
·
imports may be cheaper
·
ADVANTAGES
comparative advantage
·
country to specialise in producing stuff which it can produce effectively efficiently
>
-
&
encourages
at lowest
opportunity cost
↳
↑ consumer
surplus
·
economies of scale
"competition ↓ world prices
·
>
-
of Y
goods & services purchasing power of their income
-
>
narrow -
-
>
range
produce in at
higher volumes
↑quality
·
breaks down domestic monopolies competition encourages innovation design
· -
>
,
face competition from efficient foreign firms >
transfer of
technology
-
↳
↑
employment
>
-
export sector
multiplier process
-
>
DISADVANTAGES
over-specialisation diversity of output may diminish
· ·
>
-
World demand to risk oflosing jobs
-
local producers suffer from cheaper imports
structural
unemployment
-
>
·
infant industries difficult to survive
↳
face competition from foreign firms
UK Trade
BRITISH EXPORTS
EU US Switzerland UAE
HongKong
·
Machinery Vehicles
Semi-precious stones Fuel
BRITISH IMPORTS
Germany China us Netherlands France
·
WHY DO COUNTRIES TRADE
when they do not have the resources or capacity to satisfy their own needs and want
·
imports may be cheaper
·
ADVANTAGES
comparative advantage
·
country to specialise in producing stuff which it can produce effectively efficiently
>
-
&
encourages
at lowest
opportunity cost
↳
↑ consumer
surplus
·
economies of scale
"competition ↓ world prices
·
>
-
of Y
goods & services purchasing power of their income
-
>
narrow -
-
>
range
produce in at
higher volumes
↑quality
·
breaks down domestic monopolies competition encourages innovation design
· -
>
,
face competition from efficient foreign firms >
transfer of
technology
-
↳
↑
employment
>
-
export sector
multiplier process
-
>
DISADVANTAGES
over-specialisation diversity of output may diminish
· ·
>
-
World demand to risk oflosing jobs
-
local producers suffer from cheaper imports
structural
unemployment
-
>
·
infant industries difficult to survive
↳
face competition from foreign firms
UK Trade
BRITISH EXPORTS
EU US Switzerland UAE
HongKong
·
Machinery Vehicles
Semi-precious stones Fuel
BRITISH IMPORTS
Germany China us Netherlands France
·
