Economics and World Economy

Economics and World Economy

GLOBAL MARKETING

Economics and World Economy

UNDERSTANDING THE WORLD ECONOMY:

  • ______is OUTPUTper workerHOUR
  • ______(GNP) Total dollar value of goods and services produced by a nation, including goods/services PRODUCEDABROADby U.S. citizensandcompanies
  • ______(GDP)is the output of goods and services produced by labor and property located WITHIN a country
  • DIFFERENCE between GNP and GDP – GNPcounts the country ______for production. In GDP, the country______the productionTAKES PLACE

MEASURING INFLATION:

  • ______refers to RISINGprices(low: 1-5%, high 10% or higher, money does not have the same value)
  • ______(CPI) measures the change in priceovertime of 400 specific household goods

Examples:

  • ______(PPI) measures wholesaleprice levels in the economy (business to business costs)

Examples:

WHY TRADE INTERNATIONALLY?

Countries trade with other countries to get ______that they NEEDand do nothave in their owncountry

Four Benefits of International Trade:

(1)Increasedcompetition

(2)______

(3)______

(4) Exchange of ideas and technological advancements

Interdependence of Nations:

  • Most countries do NOTproduce or manufactureALLthe goods and services they ______
  • Countries get some of their goods and services from ______nations because each country possesses ______resources and capabilities

INTERNATIONAL TRADE:

______is the SALEof products and services topeople in othercountries

______is the world’s TOPimporter and exporter of goods

International trade ______each year

IMPORTS:

______Products or services that are PURCHASEDfrom anothercountry

The United States imports include ______

Many imports for the United States comes from ______

EXPORTS:

______Products that are PRODUCEDin your country and othercountriespurchase them

These products are ______in another country

The United States EXPORTS ______

BALANCE OF TRADE:

The DIFFERENCEbetween what a country IMPORTSand what they EXPORTis known as the

______

If it is ______, the country is spendingMOREon IMPORTSthan they are making on exports

If it is ______, the country is spendingLESSon imports and they are makingmore on exports

The United States exports ______amount and imports ______amount.

one digit
Therefore, we have a ______balance of trade

GOVERNMENT CONTROL OF INTERNATIONAL TRADE:

______everyone benefits from Free Trade

Because there are both winners and losers of free trade, sometimes governments decide to ______trade BARRIERS or RESTRICTIONS of free trade

A ______, also called a ______is a TAXon IMPORTS

A ______either:

  1. Limits the ______a product that may be imported OR
  2. Limits the ______of a product that may be imported

An ______is a totalBANon specific goods coming into and out of a country

THREE (3) TYPES OF INTERNATIONAL MARKETING:

  1. ______: The import of goods b authorized dealers; receive customer support from the legitimate importer
  2. ______: the import and sale of goods byunauthorized dealers; such activity is unofficial but NOTillegal
  • Goods have no factory warranty, and receive no customer support from the legitimate importer
  1. ______: The import and sale of goods that are STRICTLY controlled or ILLEGAL
  • Motives are to trade contraband, avoid taxes and regulations, or skirt price controls or quotas

TRADE AGREEMENTS/ALLIANCES:

THE EUROPEAN UNION (______)

Europe’s trading bloc

Free trade among its ______member ______

Created ______European currency (euro) and centralbank

  • Replaced national currencies (French/franc and German/mark)

THE WORLD TRADE ORGANIZATION (______)

Global coalition of nations that makerulesgoverninginternationaltrade

______agreements and ______disputes among ______

______member nations

NORTH AMERICAN FREE TRADE AGREEMENT (______)

Freetrade agreement between ______, ______, ______

Principal benefit is ______trade with ______

NAFTA’s mainGOALwas to ______all tradebarriers and investmentrestrictions among the 3 countries