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Teaching activity

Retrieval Activity - Specialisation and Trade

Geoff Riley

18th September 2022

Here is a Quizlet retrieval activity covering specialisation and trade.

  • Absolute advantage - Occurs when a county can produce a product using fewer resources than another nation
  • Bi-lateral trade agreement- Agreement to lower import tariffs and other trade barriers between two countries
  • Closed economy - An economy operating without imports and exports
  • Comparative advantage - Occurs when a country can benefit from specialising in and exporting the product(s) for which it has the lowest opportunity cost of supply
  • Competitiveness - Sustained ability to sell goods and services profitably at competitive prices in a foreign country
  • Containerisation - System of freight transport for use in shipping that has reduced transport costs of shipping across the globe.
  • Dynamic gains from trade - Diffusion of knowledge and technology, economies of scale and increased competition and innovation
  • Free trade - When trade in goods and services between nations is allowed to occur without any form of import restriction.
  • Intra-regional trade - Exchange of virtually identical products between countries within the same region.
  • Mercantilism - Notion that the wealth of a nation was based on how much it could export in excess of its imports, and thereby accumulate precious metals.
  • Open economy - Economy with low tariff and non-tariff barriers which is deeply integrated into the regional and global economy.
  • Relative export prices - A country's export prices relative to those of a competing economy.
  • Specialisation - When individuals, regions or countries concentrate on making one product to create a surplus to trade.
  • Trade creation - Movement from a higher cost source of output to a lower cost source of supply as a result of joining a trade agreement.
  • Trade diversion - Switch from a lower-cost foreign source/supplier outside of a customs union towards a higher-cost supplier located inside the customs union.
  • Trading bloc - A group of countries co-operating to liberalise trade between each other.

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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