Vocabulary Practice

International Trade

A International trade is the exchange of goods and services between countries. It is a way nations can specialize, increase the productivity of their resources and realize a larger total output. Trading globally gives consumers and countries the opportunity to be exposed to goods and services not available in their own countries. These are two basic reasons for international trade:

· the distribution of economic resources (natural, human and capital goods) among nations is not equal;

· efficient production of various goods requires different technologies or combination of resources.

B A product that is sold to the global market is an export, and a product that is bought from the global market is an import. Imports and exports are accounted for in a country's current account in the balance of payments. The balance of payments(BOP) is the method countries use to monitor all international monetary transactions at a specific period of time. Usually, the BOP is calculated every quarter and every calendar year. If a country has received money, this is known as a credit, and, if a country has paid or given money, the transaction is counted as a debit. Theoretically, the BOP should be zero, meaning that assets (credits) and liabilities (debits) should balance.

C The BOP is divided into three main categories: current account, capital account and financial account. The current account is used to mark the inflow and outflow of goods and services into a country. Earnings on investments, both public and private, are also put into the current account. All international capital transfers are recorded in the capital account and international monetary flows related to investment in business, real estate, bonds and stocks are documented in the financial account.

D The United States, Japan and the western European nations dominate the global economy. But the total volume of trade has been increased by several new trade participants, including the “Asian tigers” (Hong Kong, Singapore, South Korea and Taiwan), China and the eastern European countries.

Global trade has been greatly facilitated by:

- improvements in transportation technology,

- improvements in communications technology,

- general declines in tariffs,

- peaceful relations among major industrial nations.

(adapted from “Economics” by McConnel C., Brue S.)

Post-reading

1. Which paragraphs A-D give information about the following things?

1. ____ The balance of payments is divided into three main categories.

2. ____ The essence and reasons for international trade.

3. ____ The causes of trade boom in the emerging markets.

Vocabulary Practice

Дата добавления: 2015-11-16