2.  All commercial transactions between two or more countries

3.  Natural resources  Cost difference  Reason of various countries not trading internationally..

4.  Study of trade on goods and services  Study of flow of money

5.  Mobility of labour and capital  Different monetary set up  Different fiscal policy  Production cost  Product immobility  Nationalist feelings  Heterogeneous markets  Different political setups  Different foreign trade policies

6.  Currency fluctuations  Alien markets  Heavy investments

7.  Big market for local producers  Economies of scale  Export of surplus production  Fuller utilization of resources  Competitive spirit  Export surplus finance imports

8.  Unemployment due to imports  Infant industry argument  Exchange rate fluctuation: floating exchange rate of open economies  Unequal distribution of wealth

9.  International trade  Why..  Risks..  Difference from local trade  Advantages  Disadvantages..