Chapter 10: Business in a Global Economy – Flashcards
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global economy
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interconnected economies of the nations of the world
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international trade
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exchange of goods and services between nations
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globalization
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development of the global economy
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multinational corporation
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company that does business in many countries and has facilities and offices around the world
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trade
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activity of buying and selling goods and services in domestic and international markets
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domestic trade
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trade, production, purchase, and sale of goods and services within a country
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world trade
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trade and exchange of goods across international boundaries
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imports
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goods and services one country buys from another
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exports
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goods and services one country sells to another
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balance of trade
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difference in value between a country's imports and exports over a period of time
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trade surplus
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balance of trade in which a country exports more than it imports
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trade deficit
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balance of trade in which a country imports more than it exports
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specialize
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focus on a particular activity, area, or product
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comparative advantage
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ability of a country or company to produce a particular good more efficiently than another country or business
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currency
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money or type of money used by a certain group or nation
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foreign exchange market
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series of banks where different currencies are exchanged
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exchange rate
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price at which one currency can buy another currency
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appreciation
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when the value of a currency goes up compared to that of another
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depreciation
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when the value of a currency goes down compared to that of another
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protectionism
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trade pattern of the government putting limits on foreign trade to protect businesses at home
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trade barriers
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used by governments to limit competition with other countries
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tariff
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trade barrier of a tax placed on imports to increase their price in the domestic market
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quota
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trade barrier of a limit placed on the quantities of a product that can be imported
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embargo
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ban on the import or export of a product; rare and usually used for political or military reasons
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free trade
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trade pattern of the government creating few or no limits on trade between countries
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trade alliance
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group of several countries that merge their economies into one huge market for international trade
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NAFTA (North American Free Trade Agreement)
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trade alliance consisting of the United States, Canada, and Mexico
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EU (European Union)
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trade alliance consisting Austria, Belgium, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom
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ASEAN (Association of Southeast Asian Nations)
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trade alliance consisting of Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam
