| A | B |
|---|
| international trade | the exchange of goods and services between nations |
| imports | goods and services purchased from other nations |
| exports | goods and services sold to other nations |
| economic interdependence | our reliance on other countries for goods and services because we are not all self sufficient |
| absolute advantage | occurs when a country has special natural resources or capibilities that allow it to produce a given commodity at a lower cost than any other nation |
| comparitive advantage | the value a nation gain by selling the goods it produces more efficiently than other goods |
| balance of trade | the difference in value between imports and exports |
| tariff | a tax on imports |
| quotas | limits either quanity or monetary value of a product that may be imported |
| embargoes | a total ban on specific goods coming into and leaving a country |
| Most-Favored-Nation status | granted to countries that the US wants to encourage trade with - lowers tariffs and quotas |
| foreign trade zones | designated areas of a country where foreign businesses benefit from reduced tariffs |
| Export-Import Bank (Eximbank) | guarantees loans to foreign customers that want to buy U.S. products |
| International Monetary Fund (IMF) | helps stabilize exchange rates amoung the currencies of its members |
| General Agreement on Tariffs and Trade (GATT) | and international trade agreement designed to promote global free trade through reduction of tariffs and the use of a common set of rules for trading |
| North American Free Trade Agreement (NAFTA) | a trade agreement among the U.S. Canada, and Mexico |
| European Union (EU) | trading bloc that includes 12 nations |
| custom brokers | specialist who are licensed and know the different laws, procedures and tariffs |
| freight forwarding companies | companies that handle export details |
| letter of credit | protect the exporter from foreign customers who decide they don't want the goods once they have been shipped |
| draft | a reverse check |
| multinationals | large corporations that have operations in several countries |
| mininationals | midsized to smaller companies that have operations in foreign countries |
| joint ventures | a partnership with a domestic business person |
| nationalize | the government takes ownership of the businesses |
| privatization | offering government owned business for sale to private citizens |
