International Economics Flashcards

Only 10 flashcards are shown at a time! Once you’ve mastered these 10 Economic terms, click the shuffle button below for 10 new terms. There are approximately 60 flashcards covering International Economics

(MNC): A firm which operates in more than one country.

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A decrease in the value of one currency relative to another, resulting from a decrease in demand for or an increase in the supply of the currency on the forex market.

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When a government or central bank takes action to manage or fix the value of its currency relative to another currency on the forex market.

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When a country’s sale of exports exceeds its spending on imports. Another term for a current account surplus in the balance of payments.

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When the value of a nation’s exports to the rest of the world exceeds the value of its imports from the rest of the world. Also called a trade surplus.

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Measures undertaken by a government to reduce a deficit in the country’s current account balance. Involve increased barriers to trade (tariffs, quotas or protectionist subsidies) aimed at switching the expenditures of domestic consumers from imported goods and services to domestically produced goods and services.

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The spending by foreigners on domestically produced goods and services. Counts as an injection into a nation’s circular flow of income.

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Measures the flow of funds for investment in real assets (such as factories or office building) or financial assets (such as stocks and bonds) between a nation and the rest of the world.

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When the price of a nation’s exports rises relative to the price of its imports. May result in an improvement in the current account balance if demand for the country’s exports is inelastic relative to its import demand, or a worsening in the current account balance if export demand is elastic relative to import demand.

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When something is both desired and limited in supply. All resources (land, labor and capital) are limited in supply, yet desired for their use in the production of goods and services.

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