Term
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Definition
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Term
| What is international trade? |
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Definition
| The exchange of goods and services between countries |
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Term
| What roles do exporters and importers play in international trade? |
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Definition
| Exporters deliver goods; importers make payments |
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Term
| Why do countries engage in international trade? |
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Definition
| To utilize resources more efficiently and obtain products not available domestically or at better prices |
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Term
| What is specialization in the context of international trade? |
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Definition
| Producing certain goods based on resource availability and quality, then trading for others |
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Term
| How does trade increase overall economic well-being? |
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Definition
| By providing a greater selection of goods and services at lower costs |
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Term
| What are consumer surplus and producer surplus? |
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Definition
| Measures of economic well-being, where consumer surplus benefits consumers and producer surplus benefits producers |
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Term
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Definition
| An early economic philosophy advocating for exporting more than importing |
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Term
| Who opposed mercantilism and what did they advocate? |
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Definition
| Adam Smith; he advocated for free trade and specialization based on absolute advantage |
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Term
| What is the concept of comparative advantage? |
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Definition
| A country can benefit from trade by specializing in goods where it has a relative advantage, even if it has an absolute disadvantage |
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Term
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Definition
| Measures like tariffs, quotas, and non-tariff barriers introduced by governments to protect domestic industries |
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Term
| What is the Balance of Payments (BOP)? |
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Definition
| A statistical statement recording a country's economic transactions with the rest of the world |
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Term
| What does the Balance of Payments consist of? |
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Definition
| The current account and the capital and financial account |
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Term
| What are foreign exchange reserves? |
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Definition
| Assets held by a central bank in foreign currencies to back liabilities and influence monetary policy |
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Term
| What is currency convertibility? |
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Definition
| The ease with which a country's currency can be converted into another currency |
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Term
| What are the two types of currency convertibility? |
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Definition
| Partial and full convertibility |
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Term
| Since when has the Bangladesh Taka been convertible on the current account? |
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Definition
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Term
| What does international banking involve? |
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Definition
| Cross-border business in any currency and local business in foreign currencies |
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Term
| What are the four main international trade payment methods? |
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Definition
* Cash in Advance
* Open Account
* Documentary Collection
* Documentary Credit |
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Term
| What role do banks play in international trade? |
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Definition
| Facilitating payments, providing financing services, and offering risk management services |
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Term
| True or False: Trade barriers always benefit free trade. |
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Definition
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