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International Economies - Coggle Diagram
International Economies
International Trade
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A closed economy does not sell or buy any goods and services to and from other countries but simply supply goods and services by itself.
without international trade, the varieties and quantities of goods and services will be limited due to limited resources.
Advantages of trade
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Prevent monopoly power
Importing goods from other countries can reduce the possibility of a producer to monopolises a certain production of good in the domestic market.
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Barriers on free trade
Every country will have some controls or restrictions over these international trade activities and this restrictions are known as the ‘protectionism policies’.
Protectionism is the barriers to the free flow of imported goods and services set up by a country in order to protect domestic industries from foreign competition
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