The Basis for International Trade Outcomes

4.1.1 Drawing on examples describe how economies are interdependent. (a) Describe the reasons for trade among and within nations. (k) Explain the benefits of trade among individuals, regions, and countries. (k) Define absolute advantage, comparative advantage and specialization. (k)

4.1.1 Drawing on examples describe how economies are interdependent. (a) Countries trade. Some countries have things other countries need – for example natural resources. An example of trade: Christmas Trees in DubaiChristmas Trees in Dubai Prices could be lower in other countries. People can move between countries. Countries send military forces around the world. Countries assist each other financially.

4.1.2 Describe the reasons for trade among and within nations. (k) There are advantages to trading. Some are more affective at producing goods than others. Not every nation has the same resources. To acquire luxuries. It assists in positive relations. It can be a source of income for a country or region.

4.1.3 Explain the benefits of trade among individuals, regions, and countries. (k) Access to good you couldn’t get otherwise. Access to resources Better relations between regions. Generates income. Technology or knowledge can be traded. Could create more employment. Can be of benefit to both or multiple parties. Can result in lower prices. Can result in greater efficiency in resource use.

4.1.4 Define absolute advantage, comparative advantage and specialization. (k) Absolute advantage: Someone is definitively better at creating something than another. Comparative advantage: Comparing one person to another, one individual could create an overall advantage for everyone, through trade.