Chapter 16
Misery Index
The economist who invented this index was named Arthur Okun.
The Index was created way back in the 1960s.
The index helps determine how the average citizen is doing economically and it is calculated by adding the seasonally adjusted unemployment rate to the annual inflation rate.
International Trade Advantages and Disadvantages
Disadvantages- Economic Dependence, Political Dependence, Storage of goods.
If it weren't for international trade, you'd never be able to get your hands on, say, a mango, or a cup of coffee. International Trade is important.
Advantages- Get goods not produced by your country, focus on certain goods to create to make perfect, stable prices.
Globalization vs. Protectionism
Globalization is the process by which businesses or other organizations develop international influence or start operating on an international scale.
Protectionism is the theory or practice of shielding a country's domestic industries from foreign competition by taxing imports.
The difference is the Global wants to grow and Protect wants to bring back and stay in the USA.
Collectivization vs. Privatization
Air Canada in 1988 was Privatized.
Privatization is the transfer of a business, industry, or service from public to private ownership and control.
Collectivization is the organization of a industry or economy.
NAFTA
NAFTA is what creates lower food and gas prices while easing trade
NAFTA is accused of lowering the US wage while making 450 million jobs go away.
NAFTA reduces the USA government spending overall by a lot.
European Union
The population is over 500 million.
All the country's in this union come together to discuss ideas or new topics
The European Union is a political and economic union of 28 member states that are located primarily in Europe.
Comparative Advantage
Adam Smith wrote a book about the comparative advantage.
Oil producing country's have comparative advantage based on the quantity they own.
the ability of an individual or group to carry out a particular economic activity (such as making a specific product) more efficiently than another activity.