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Foreign trade (characteristics (trade outside the country's borders,…
Foreign trade
characteristics
trade outside the country's borders
Countries that trade have open economies
It is usually subject to special regulations (control, process, taxes, etc.)
they usually sign agreements or commercial agreements that seek to facilitate exchange processes.
Advantage
People can access cheaper and varied goods.
local goods but at a reduced price.
complement domestic production when it is insufficient to meet local demand
the exchange of goods and services between two or more countries
subject to various standards of control of products (sanitary, security, etc.), as well as procedures (bureaucratic procedures, registrations, etc.) and taxation (taxes, tariffs, etc.).
The entry or exit of products will generate a currency flow
Exchange rate fluctuations may affect the flows
Customs
in charge of controlling the inflows and flows of goods through the border and the application of taxes (fees or taxes) determined by law.
Forms of foreign trade
Export
Import
2 more items...
goods and services sold by a country in foreign territory.
The main objective
meet consumer demand by taking advantage of the comparative advantages that each country has
Disadvantages
It can be harmful for less efficient local businesses
Foreign Trade Models
Adam Smith's absolute advantage
Relative advantage of David Ricardo
Heckscher-Ohlin model
Singer-Prebish Model