10 Points: (x2)
- https://quizlet.com/83929458/unit-7-vocabulary-flash-cards/
-Unit 6 Vocabulary
Chapter 17
Absolute Advantage
The ability to produce more of a given product using a given product using a given amount of resources
Example: Kate can produce more birdhouses than Carl with the same amount of resources and time
Comparative Advantage
The ability to produce a product most efficiently given all the other products that could be produced
Example: specialization in countries
Law of comparative advantage
The idea that a nation is better off when it produces goods and services for which it has a comparative advantage
Example: North Dakota might be better off producing oil than silk
Export
A good that is sent to another country for sale
Example: China sends us plastic
Import
A good that is brought in from another country for sale
Example: The US buys plastic from China
Trade Barrier
A means of preventing a foreign product or service from freely entering
Example: Customs
Import quota
A limit on the amount of a good that can be imported
Example: 500 lb of strawberries
Voluntary Export Restraint
A self-imposed limitation on the number of a products shipped to a particular country
Example: The US limiting exports to Germany in hopes that they won't set up trade barriers
Customs duty
A tax on certain items purchased abroad
Example: Tax on clothes purchased in France
Tariff
A tax on imported goods
Example: Tax on tea from Brazil
Trade war
A cycle of increasing trade restrictions
Example: If US and the Soviet Union kept setting up more taxes on imports
Protectionism
The use of trade barriers to protect a nation's industries from foreign competition
Example: protecting worker's jobs
Infant industry
A new industry
Example: a new company selling super fancy high tech pillows
International free trade agreement
Agreement that results from cooperation between at least 2 countries to reduce trade barriers and tariffs and to trade with each other
Example: If the US and Iraq did this
World Trade Organization
A worldwide organization whose goal is freer global trade and lower tariffs
Example: the WTO
European Union
A regional trade organization made up of European nations
Example: The EU
Euro
A single currency that replaces individual currencies among members of the European Union
Example: the Euro in England
Free-Trade Zone
A region where a group of countries agrees to reduce or eliminate trade barriers
Example: NAFTA
NAFTA – North American Free Trade Agreement
Agreement that will eliminate all tariffs and other trade barriers between Canada, Mexico, and the United States
Exchange rate
The value of a foreign nation's currency in terms of the home nation's currency
Example: 1.6 dollars = a euro
Appreciation
An increase in the value of a currency
Example: The US dollar being worth more than the euro
Depreciation
A decrease in the value of a currency
Example: The US dollar being worth even less that the euro
Foreign exchange market
The banks and other financial institutions that facilitate the buying and selling of foreign currencies
Example: TCF bank
Fixed exchange rate system
A currency system in which governments try to keep the values of their currencies constant against one another
Flexible exchange rate system
A currency system that allows the exchange rate to be determined by supply and demand
Trade surplus
The result of a nation exporting more than it imports
Example: China
Trade deficit
The result of a nation importing more than it exports
Example: England
Balance of trade
The relationship between a nation's imports and its exports
Example: surplus
Chapter 18
Development
The process by which a nation improves the economic, political, and social well-being of its people
Example: The US when it was established
Developed nation
Nation with a higher average level of material well-being
Example: The US
Less developed country
Nation with a low level of material well-being
Example: Uganda
Per capita GDP
A nation's gross domestic product divided by its total population
Example: 1.6
Industrialization
The extensive organization of an economy for the purpose of manufacture
Example: the industrial revolution
Subsistence Agriculture
Level of farming in which a person raises only enough food to feed his or her family
Example: enough tomatoes for 5 people
Literacy rate
The proportion of the population over age 15 that can read and write
Example: high percent in US
Life expectancy
The average expected life span of an individual
Exampe: much lower in Uganda
fdaInfant mortality rate
The number of deaths that occur in the first year of life per 1,000 live births
Example: 6.4 in the US
Infrastructure
The services and facilities necessary for an economy to function
Example: transportation
Newly industrialized country
Less developed country that has shown significant improvement in the measures of development
Example: Mexico
Population growth rate
The increase in a country's population in a given year, expressed as a percentage of the population figure at the start of a year
Example: 50%
Natural rate of population increase
The difference between the birth rate and the death rate
Example: 1%
Arable land
Suitable for producing crops
Example: A farm
Malnutrition
Inadequate nutrition
Example: poor diet
Foreign investment
Investment originating from other countries
Example: US investing in Haiti
Foreign direct investment
The establishment of enterprise by a foreigner
Example: A foreign company entering a partnership with a local company
World bank
The largest provider of development assistance
Example: raising money
United Nations Development Programme
United Nations program dedicated to elimination of poverty through developement
Example: helping build stuff
International Monetary Fund
Organization formed to stabilize international exchange rates and facilitate development
Example: IMF
Debt Rescheduling
Lengthening the time of debt repayment and forgiving, or dismissing, part of the loan
Example: making a loan due 2020 instead of 2015
Stabilization Program
An agreement between a debtor nation and the IMF in which the nation agrees to revise its economic policy
Example: maybe helping a debt rescheduling take place
Privatization
The sale or transfer of state-owned businesses to individuals
Example: Government property to individual
Special economic zones
Designated regions in China where foreign investment is encouraged, businesses can make most of their own investment and production decisions, and foreign companies are allowed to operate
Soviet Union’s collapse
The Soviet Union was communist but wanted economic and social reform and quickly became Russia.
Chinese transition to free market
China struggled with civil was in 1949 and has been developing its own version of communism since then
1 Point (x5)
- If anyone is interested in learning more in depth about industrialization, Wikepedia provides a great resource for this! It offers an in-depth explanation. http://en.wikipedia.org/wiki/Industrialisation
- At the end of chapter 18 the book started talking about the Chinese transition to free market. This article hyperlinked talks a little bit more about China's transition to a free market! http://www.cato.org/policy-report/januaryfebruary-2013/how-china-became-capitalist
- The Soviet Union's collapse was discussed at the end of Chapter 18, but the article linked here talks about the fall of the Soviet Union with more detail than the book offers. http://www.coldwar.org/articles/90s/fall_of_the_soviet_union.asp
- This website talks about the North American Free Trade Agreement and is very neat because it gives different opinions about it on a timeline so you can see the progression of it. http://topics.nytimes.com/top/reference/timestopics/subjects/n/north_american_free_trade_agreement/index.html
- https://quizlet.com/83929458/unit-7-vocabulary-flash-cards/
-Unit 6 Vocabulary
Chapter 17
Absolute Advantage
The ability to produce more of a given product using a given product using a given amount of resources
Example: Kate can produce more birdhouses than Carl with the same amount of resources and time
Comparative Advantage
The ability to produce a product most efficiently given all the other products that could be produced
Example: specialization in countries
Law of comparative advantage
The idea that a nation is better off when it produces goods and services for which it has a comparative advantage
Example: North Dakota might be better off producing oil than silk
Export
A good that is sent to another country for sale
Example: China sends us plastic
Import
A good that is brought in from another country for sale
Example: The US buys plastic from China
Trade Barrier
A means of preventing a foreign product or service from freely entering
Example: Customs
Import quota
A limit on the amount of a good that can be imported
Example: 500 lb of strawberries
Voluntary Export Restraint
A self-imposed limitation on the number of a products shipped to a particular country
Example: The US limiting exports to Germany in hopes that they won't set up trade barriers
Customs duty
A tax on certain items purchased abroad
Example: Tax on clothes purchased in France
Tariff
A tax on imported goods
Example: Tax on tea from Brazil
Trade war
A cycle of increasing trade restrictions
Example: If US and the Soviet Union kept setting up more taxes on imports
Protectionism
The use of trade barriers to protect a nation's industries from foreign competition
Example: protecting worker's jobs
Infant industry
A new industry
Example: a new company selling super fancy high tech pillows
International free trade agreement
Agreement that results from cooperation between at least 2 countries to reduce trade barriers and tariffs and to trade with each other
Example: If the US and Iraq did this
World Trade Organization
A worldwide organization whose goal is freer global trade and lower tariffs
Example: the WTO
European Union
A regional trade organization made up of European nations
Example: The EU
Euro
A single currency that replaces individual currencies among members of the European Union
Example: the Euro in England
Free-Trade Zone
A region where a group of countries agrees to reduce or eliminate trade barriers
Example: NAFTA
NAFTA – North American Free Trade Agreement
Agreement that will eliminate all tariffs and other trade barriers between Canada, Mexico, and the United States
Exchange rate
The value of a foreign nation's currency in terms of the home nation's currency
Example: 1.6 dollars = a euro
Appreciation
An increase in the value of a currency
Example: The US dollar being worth more than the euro
Depreciation
A decrease in the value of a currency
Example: The US dollar being worth even less that the euro
Foreign exchange market
The banks and other financial institutions that facilitate the buying and selling of foreign currencies
Example: TCF bank
Fixed exchange rate system
A currency system in which governments try to keep the values of their currencies constant against one another
Flexible exchange rate system
A currency system that allows the exchange rate to be determined by supply and demand
Trade surplus
The result of a nation exporting more than it imports
Example: China
Trade deficit
The result of a nation importing more than it exports
Example: England
Balance of trade
The relationship between a nation's imports and its exports
Example: surplus
Chapter 18
Development
The process by which a nation improves the economic, political, and social well-being of its people
Example: The US when it was established
Developed nation
Nation with a higher average level of material well-being
Example: The US
Less developed country
Nation with a low level of material well-being
Example: Uganda
Per capita GDP
A nation's gross domestic product divided by its total population
Example: 1.6
Industrialization
The extensive organization of an economy for the purpose of manufacture
Example: the industrial revolution
Subsistence Agriculture
Level of farming in which a person raises only enough food to feed his or her family
Example: enough tomatoes for 5 people
Literacy rate
The proportion of the population over age 15 that can read and write
Example: high percent in US
Life expectancy
The average expected life span of an individual
Exampe: much lower in Uganda
fdaInfant mortality rate
The number of deaths that occur in the first year of life per 1,000 live births
Example: 6.4 in the US
Infrastructure
The services and facilities necessary for an economy to function
Example: transportation
Newly industrialized country
Less developed country that has shown significant improvement in the measures of development
Example: Mexico
Population growth rate
The increase in a country's population in a given year, expressed as a percentage of the population figure at the start of a year
Example: 50%
Natural rate of population increase
The difference between the birth rate and the death rate
Example: 1%
Arable land
Suitable for producing crops
Example: A farm
Malnutrition
Inadequate nutrition
Example: poor diet
Foreign investment
Investment originating from other countries
Example: US investing in Haiti
Foreign direct investment
The establishment of enterprise by a foreigner
Example: A foreign company entering a partnership with a local company
World bank
The largest provider of development assistance
Example: raising money
United Nations Development Programme
United Nations program dedicated to elimination of poverty through developement
Example: helping build stuff
International Monetary Fund
Organization formed to stabilize international exchange rates and facilitate development
Example: IMF
Debt Rescheduling
Lengthening the time of debt repayment and forgiving, or dismissing, part of the loan
Example: making a loan due 2020 instead of 2015
Stabilization Program
An agreement between a debtor nation and the IMF in which the nation agrees to revise its economic policy
Example: maybe helping a debt rescheduling take place
Privatization
The sale or transfer of state-owned businesses to individuals
Example: Government property to individual
Special economic zones
Designated regions in China where foreign investment is encouraged, businesses can make most of their own investment and production decisions, and foreign companies are allowed to operate
Soviet Union’s collapse
The Soviet Union was communist but wanted economic and social reform and quickly became Russia.
Chinese transition to free market
China struggled with civil was in 1949 and has been developing its own version of communism since then
1 Point (x5)
- If anyone is interested in learning more in depth about industrialization, Wikepedia provides a great resource for this! It offers an in-depth explanation. http://en.wikipedia.org/wiki/Industrialisation
- At the end of chapter 18 the book started talking about the Chinese transition to free market. This article hyperlinked talks a little bit more about China's transition to a free market! http://www.cato.org/policy-report/januaryfebruary-2013/how-china-became-capitalist
- The Soviet Union's collapse was discussed at the end of Chapter 18, but the article linked here talks about the fall of the Soviet Union with more detail than the book offers. http://www.coldwar.org/articles/90s/fall_of_the_soviet_union.asp
- This website talks about the North American Free Trade Agreement and is very neat because it gives different opinions about it on a timeline so you can see the progression of it. http://topics.nytimes.com/top/reference/timestopics/subjects/n/north_american_free_trade_agreement/index.html