Business 4.1 Revision

What is a tariff?
Taxes imposed on imports which make imports more expensive.
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What is globalisation?
The growing integration of the worlds economies
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What is dumping?
Where an overseas firm sells large quantities of a product below cost in the domestic market.
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What is an import Quota?
A physical limit on the quantity of imports allowed into a country.
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What is protectionism?
An approach used by a government to protect domestic producers.
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Why do governments use trade barriers?
Protect jobs/ Protect infant industries/ Prevent dumping/ Raise revenue/ Prevent the entry of harmful or undesirable goods/ Improve the balance of payments.
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What are the problems with having trade barriers?
Countries may retaliate when barriers are imposed and this behaviour could escalate into a trade war where trade between the countries stop. Tariffs may also be ineffective if demand for imports is inelastic
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What is a trading bloc?
A group of countries that havesigned a regional trade agreement to reduce or eliminate tariffs,quotas and other protectionist barriers between themselves.
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What is foreign direct investment?
Investing by setting up operations or buying assets in businesses in another country.
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Give factors contributing to increased globalisation?
Reduction of international trade barriers/ Political change/ Reduced cost of transport and communication/ increased significance of global transnational companies/ Increased investment flows/ Migration/ Growth of the global labour force
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What is a transnational company?
Companies that own or control production or service facilities outside the country in which they are based.
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What is a trade barrier?
Measures designed to restrict trade
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Other cards in this set

Card 2

Front

What is globalisation?

Back

The growing integration of the worlds economies

Card 3

Front

What is dumping?

Back

Preview of the front of card 3

Card 4

Front

What is an import Quota?

Back

Preview of the front of card 4

Card 5

Front

What is protectionism?

Back

Preview of the front of card 5
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