-
exports
- goods and services sold to
- other countries
-
imports
- Goods and services purchased
- from other countries are
-
Globalization
- phenomenon of growing economic
- linkages among countries
-
Ricardian model of international trade
- assumption that opportunity costs
- are constant within a country, but
- different between countries.
-
Autarky
- situation in which a country
- cannot trade with other countries.
-
Heckscher-Ohlin model
- country has a comparative advantage
- in a good whose production is
- intensive in the factors that are
- abundantly available in that country.
-
factor intensity
- production of a good is a measure
- of which factor is used in relatively
- greater quantities than other factors in
- production
-
competitive market
- Many buyers and sellers
- Same good or service from the point
- of view of the consumer
- No artificial barriers to entry or exit
-
demand schedule
- shows how much of a good or
- service consumers will want to
- buy at different prices.
-
quantity demanded
- actual amount consumers are
- willing to buy at some specific price
-
law of demand
- higher price for a good, other things
- equal, leads people to demand a
- smaller quantity of the good
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