1. IN TERNATIONAL TRADE PROTECTION, TARIFF, EFFECTIVE TARIFF, CHAPTER 8 KRUGMAN AND OBSTFELD INTRA INDUSTRY TRADE TRADE WITHIN AN INDUSTRY, EXPORT AND IMPORT THE SAME PRODUCT OR SERVICE

2. CA AND AA EITHER IMPORT OR EXPORT…..NOT BOTH WHY DIFFERENTIATED PRODUCTS AND IMPERFECT COMPETITION PC….HOMOGENOUS PRODUCT ITALIAN SHOES NOT THE SAME AS INDIAN SHOES

3. IIT IS SIGNIFICANT LARGE PART OF WORLD TRADE LARGER PART OF ADVANCED COUNTRY TRADE IIT DOMINATES TRADE BETWEEN EU MEMBERS GAINS…CONSUMER CHOICE…CONSUMERS (OR SOME OF THEM REGARD THE PRODUCTS AS DIFFERENT)

4. ECONOMIES OF SCALE ARISE THROUGH TRADE IF THE DIFFERENT TASTES ARE TO BE SATISFIED IIT ALLOWS A COUNTRY TO REDUCE THE NUBER OF PRODUCTS PRODUCED AND THEREFORE GET GAINS FROM LARGER PRODUCTION RUNS AND AT THE SAME TIME INCREASE THE RANGE OF PRODUCTS CONSUMED

5. IIT WILL OCCUR BETWEEN COUNTRIES WITH SIMILAR ECONOMIC CAPABILITIES, SIMILAR CAPITAL OUTPUT RATIOS AND SKILLS GAINS GREATER WHERE ECONOMIES OF ACALE ARE SIGNIFICANT AND PRODUCTS ARE HIGHLY DIFFERENTIATED

6. MEASUREMENT INDEX OF IIT= 1- [EXPORTS-IMPORTS] divided by EXPORTS+IMPORTS ABSOLUTE VALUE OF THE TRADE BALANCE NO IIT=0 COMPLETE IIT=1

7. DEFINITION OF INDUSTRY CLASSIFICATION VEHICLES…..CONSTRUCTION TRUCKS ETC AND CARS

8. HECKSCHER-OHLIN THEORY FACTOR PROPORTIONS THEORY FOCUS ON DIFFERENT RESOURCE ENDOWMENTS OR RELATIVE PROPORTIONS CAPITAL INTENSIVE AND LABOUR INTENSIVE CA THEORY

9. CAPITAL RICH ECONOMY EXPORTS THE CAPITAL INTENSIVE PRODUCT AND IMPORTS THE LABOUR INTENSIVE PRODUCT RICH COUNTRIES ARE CAPITAL INTENSIVE LEONTIEF PARADOX 1950s US EXPORTS LESS CAPITAL INTENSIVE THAN US IMPORTS

10. HUMAN CAPITAL A KEY ELEMENT SODERSTEN AND REED

11. EXCHANGE RATES PRICE OF A DIFFERENT CURRENCY SUPPLY OF FORG EX DEMAND FOR FORG EX FORG EX RELATED TO B/P ITEMS TRADE, CAPITAL FLOWS, TOURISM MANY ASPECTS OF ECONOMIC ACTIVITY DO NOT ENTER INTO INTER TRADE RENT, LOCAL SERVICES

12. PURCHASING POWER PARITY RELATIVE PRICE OF A BASKET OF GOODS/SERVICES IN EACH COUNTRY MCDONALDS STANDARD INCLUDES ITEMS NOT IN INTER TRADE TRUER MEASURE OF RELATIVE PURCHASING POWER

13. EXCHANGE RATE A FUNCTION OF THE SUPPLY /DEMAND FOR FORG EX WHY IS THERE A DEMAND AND SUPPLY USA/EU € AND $ EU DEMANDS $ TO DO BUSINESS WITH USA AND SUPPLIES € USA DEMANDS € TO DO BUSINESS WITH EU AND SUPPLIES $

14. OTHER THINGS BEING EQUAL IF DOLLAR IS CHEAP(FEW CENT FOR $) PEOPLE IN EU WILL WANT MORE $ TO BUY USA GOODS AND SERVICES VICE VERSA SUPPLY AND DEMAND CURVES SHIFS IN CURVES, WHY AND IMPACT