Match each of the terms on the left with its definition on the right. Click on the term first and then click on the matching definition. As you match them correctly they will move to the bottom of the activity.
Imports Exports Globalization Ricardian model of international trade Autarky Factor intensity Heckscher–Ohlin model Domestic demand curve Domestic supply curve World price Exporting industries Import-competing industries Free trade Trade protection Protection Tariff Import quota Balance of payments accounts Balance of payments on current account (current account) Merchandise trade balance (trade-balance) Balance of payments on financial account (financial account) Foreign exchange market Exchange rates Appreciation Depreciation Equilibrium exchange rate Real exchange rates Purchasing power parity | the difference between a country’s exports and imports of goods alone—not including services a legal limit on the quantity of a good that can be imported the exchange rate at which the quantity of a currency demanded in the foreign exchange market is equal to the quantity supplied the difference in the ratio of factors used to produce a good in various industries. For example, oil refining is capital-intensive compared to clothing manufacture because oil refiners use a higher ratio of capital to labor than do clothing producers the exchange rate adjusted for international differences in aggregate price levels a tax levied on imports. trade that is unregulated by government tariffs or other artificial barriers; the levels of exports and imports occur naturally, as a result of supply and demand a fall in the value of one currency in terms of other currencies a rise in the value of one currency in terms of other currencies the price at which currencies trade, determined by the foreign exchange market a summary of a country’s transactions with other countries, including two main elements: the balance of payments on current account and the balance of payments on financial account policies that limit imports; also known simply as protection goods and services sold to other countries transactions that don’t create liabilities; a country’s balance of payments on goods and services plus net international transfer payments and factor income the market in which currencies can be exchanged for each other a model that analyzes international trade under the assumption that opportunity costs are constant a situation in which a country does not trade with other countries (between two countries’ currencies) the nominal exchange rate at which a given basket of goods and services would cost the same amount in each country a model of international trade in which a country has a comparative advantage in a good whose production is intensive in the factors that are abundantly available in that country industries that produce goods or services that are also imported goods and services purchased from other countries the price at which a good can be bought or sold abroad the phenomenon of growing economic linkages among countries policies that limit imports; an alternative term for trade protection. a demand curve that shows how the quantity of a good demanded by domestic consumers depends on the price of that good industries that produce goods or services that are sold abroad international transactions that involve the sale or purchase of assets, and therefore create future liabilities a supply curve that shows how the quantity of a good supplied by domestic producers depends on the price of that good |
Imports, p. 572
Exports, p. 572
Globalization, p. 572
Ricardian model of international trade, p. 573
Autarky, p. 574
Factor intensity, p. 579
Heckscher–Ohlin model, p. 579
Domestic demand curve, p. 582
Domestic supply curve, p. 582
World price, p. 582
Exporting industries, p. 586
Import-competing industries, p. 586
Free trade, p. 588
Trade protection, p. 588
Protection, p. 588
Tariff, p. 588
Import quota, p. 590
Balance of payments accounts, p. 592
Balance of payments on current account (current account), p. 594
Balance of payments on goods and services, p. 594
Merchandise trade balance (trade balance), p. 594
Balance of payments on financial account (financial account), p. 594
Foreign exchange market, p. 599
Exchange rates, p. 599
Appreciation, p. 599
Depreciation, p. 599
Equilibrium exchange rate, p. 600
Real exchange rate, p. 602
Purchasing power parity, p. 604