Chapter 3 Vocabulary

  1. Importing
    Buying products from another country.
  2. Exporting
    Selling products to another country.
  3. Free Trade
    The movement of goods and services among nations without political or economic barriers.
  4. Comparative Advantage Theory
    Theory that states that a country should sell to other countries those products that it produces most effectively and efficiently, and buy from other countries those products that it cannot produce as effectively and efficiently.
  5. Absolute Advantage
    The advantage tat exists when a country has a monopoly on producing a specific product or is ale to produce it more efficiently that all other countries.
  6. Licensing
    The global strategy in which a firm (the licensor) allows a foreign company (the licensee) to produce its product in exchange for a fee (a royalty)
  7. Contract Manufacturing
    A foreign country's production of private-label goods to which a domestic company then attaches its brand name or trademark; part of the broad category of out sourcing.
Card Set
Chapter 3 Vocabulary
Chapter 3 Vocabulary