| A | B |
|---|
| Absolute Advantage | exists when a country can produce a good or service at a lower cost than other countries |
| Balance of Payment | the difference between the amount of money that comes into a country and the amount that goes out of it |
| Balance of Trade | the difference between a country’s total exports and total imports. |
| Comparative Advantage | is a situation in which a country specializes in the production of a good or service at which it is relatively more efficient |
| Common Markets | when countries that are members freely invest in one another |
| Exports | goods and services sold to other countries |
| Imports | are items bought from other countries |
| Embargo | when a government bans the import or export of specified goods. |
| Free-Trade Agreement | when countries that are members remove duties and trade barriers on products traded among them to increase trade between members |
| Free-Trade Zone | - include selected areas that allow duty-free products to be imported, and then stored, assembled, and/or used in manufacturing |
| Licensing | is selling the right to a company to use some intangible property (production process, trademark, or brand name) for a fee or royalty |
| Quota | a limit on the quantity of good that may be imported or exported within a given period to regulate international trade |
| Tariff | taxes on certain imported products which increases prices. |
| International Monetary Fund (IMF) | Helps promote economic cooperation and maintain an orderly system of world trade and exchange rates. |
| World Bank | Provides economic aid to developing countries to fund building communications systems, transportation networks, and energy plans |
| World Trade Organization (WTO) | Settles trade disputes and enforces free-trade agreements among its members. |
