International trade practice 02.ppt

International Trade 1 Question-discussion moment Why do countries trade Why do other countries buy some goods from USA Shouldn’t a strong country such as the United States produce all the products rather than import from Japan? 2 Trade news moment: Read, Puzzle, Ask, Discuss International Trade Objectives: To master some basic concepts such as Trade, Visible Trade, Barter, etc… To master the ways to measure the international trade To understand causes of the international trade International Trade What is international trade? What is the origin of international trade? Why trade with other nations? What are traded internationally? How to measure international trade? What is international trade? International trade is the fair and deliberate exchange of goods and services across national boundaries International trade VS foreign trade Free trade The movement of goods and services among nations without political or economic obstruction. International trade vs. foreign trade International trade, also called “world trade”, generally refers to the exchange of goods and services among different countries. It is the aggregate of the import and export of all the nations. Foreign trade refers to the exchange of goods and services of one country region with another country region . It comprises two parts - import and export. Pros and Cons of free trade Pros The global market contains over 6 billion potential customers for goods and services. Productivity grows when countries produce goods and services in which they have a comparative advantage. Global competition and lower-cost imports keep prices down, so inflation should not curtail economic growth. Open trade encourages innovation, with fresh ideas coming from foreign markets Uninterrupted flow of capital gives countries access to foreign investments, which keeps interest rates low. Cons Domestic workers in manufacturing lose jobs due to increased imports or production shifts to global markets. Workers c