Trade

Question 1

Define trade, imports and exports

Answer 1

Trade- exchange of goods and services between countries
Exports- A good or service produced domestically and sold abroad
Imports- A good or service produced abroad and sold domestically

Question 2

Define balance of trade

Answer 2

Difference between value of exports and imports

Question 3

Absolute vs comparative advantage

Answer 3

Absolute- production at a lower cost
Comparative- production at a lower opportunity cost