International trade
What International trade means in Economics B A-Level, as defined for Pearson Edexcel.
Definitions of International trade
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Reference: Pearson Edexcel
Global trade driven by increasing specialisation, as nations must export their surplus and import what they no longer produce.
Firms often engage in this to extend the product life cycle of their goods by entering multiple international markets.
Activity for which external shocks can cause volatility in a floating exchange rate, creating uncertainty.
Activity in which firms face exchange rate volatility and can hedge against it through forward markets.
The exchange of goods and services, encouraged by trade liberalisation, which has reduced tariffs.
Global trade dynamics altered as emerging markets increase their share of global GDP.
Topics that use International trade
- Conditions that prompt trade (Pearson Edexcel A-Level)
- Globalisation (Pearson Edexcel A-Level)
- Growing economies (Pearson Edexcel A-Level)
- Policy instruments (Pearson Edexcel A-Level)
- The role of the financial sector (Pearson Edexcel A-Level)
- Trade and growth (Pearson Edexcel A-Level)
Related terms
- Economic growth
- Foreign direct investment (FDI)
- Offshoring
- Automatic stabiliser
- Base year
- Capacity utilisation
- Capital allocation
- Comparative advantage
Using International trade in the exam
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