Global Economy Why do we trade with the rest of the world?

Global Economy 1.Buying and selling goods and services between countries Look at some of the things you have on today. You have in front of you. The electronics you carry. The food you eat. Where does it come from?

Why we trade 1.To get things we cannot make ourselves The US can only do some much. We have lots of technology and lots of ways to create false environments (green houses). But, at the end of the day, it might simply be more efficient to import items from other countries. Not everyone agrees with this, but this is economics class, not ethics or debate. This is simply how it works. 2.To get things at a lower cost Again, not everyone agrees with this, but because there might not be as many regulations overseas (minimum wage, taxes) we can get many things from other countries for cheaper than we can make them here in the US 3.To sell to other countries On the flip side – we have things that other countries need – so they buy from us 4.To create jobs The more production and demand there is – the more jobs can be created.

Specialization Every state/country has a certain good/service they produce = better quality, lower cost Think of states that have a “particular item”. Something that they are KNOWN for. This is their specialty. Sure, we can find a way to grow tobacco. But why? North Carolina is already pretty efficient at this. Their environment is better suited for it. Therefore they can make it cheaper and probably better.

Impact of Technology 1.Increase flow of information about products and services We are more aware of what is going on and what is being made thanks to things like the Internet, cell phone service. Think of the things you can get on Amazon. Think of the new technology that we have access to. The new VR headsets JUST released this week – that is madness. Without technology, we would have NO idea that these things existed. 2.The use of technology lowers production cost Technology makes production a lot faster. Also, machines make less mistakes than humans and are more precise in creation. Some things are still valuable and necessary that are “handmade” – but think of how much time the assembly line saved Henry Ford! Exactly!

ONE PAGER – combining specialty, factors of production, and impact of technology! You will create a one pager on a good/service that is a specialty item in a certain area. Your one pager MUST include -the state/country -good/service that is specialized -3 human resources -3 natural resources -3 reasons for capital -3 ways technology changed the way the good/service is produced. You must also create a central image that identifies the good/service. Your border should identify or symbolize the factors of production.