Economics section D definitions

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Globalisation
The growing integration of the world’s economies. An increase in trade as a proportion of GDP, increased importance of MNCs and increased FDI.
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Multinational companies (MNCs)
A large and powerful firm that sells goods and services into global markets and owns production plants and other operating facilities all over the world.
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Foreign Direst investment (FDI)
Business investment undertaken by a firm in another country, building a factory for example.
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International trade
The exchange of goods and services between countries
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Free trade
Trade between nations that is completely without government restrictions.
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Outsourcing
A practice used by different companies to reduce costs by transferring portions of work to outside suppliers rather than completing it internally.
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Protectionism
An approach used by government to protect domestic buyers. (Three types: Tariffs, Quotas and subsidies.)
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Dumping
Where an overseas firm sells large quantities of a product below cost in the domestic market.
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Tariff
A tax on imports to make them more expensive
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Quota
A physical limit on the quantity of imports allowed into a country.
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Subsidies
A grant from the government to lower the production costs of domestic firms.
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Trading bloc
A group of countries situated in the same region that join together and enjoy trade free of tariffs, quotas and other forms of trade barrier.
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World trade organisation (WTO)
An international organisation that promotes free trade by persuading countries to abolish tariffs and other barriers. It policies free trade agreements and settles trade disputes between governments and organises trade negotiations.
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Exchange rate
The price of one currency in terms of another.
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Foreign exchange markets
The markets where foreign currencies can be bought and sold
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Appreciation
An increase in the value of a currency relative to others.
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Depreciation
An decrease in the value of a currency relative to others.
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Other cards in this set

Card 2

Front

Multinational companies (MNCs)

Back

A large and powerful firm that sells goods and services into global markets and owns production plants and other operating facilities all over the world.

Card 3

Front

Foreign Direst investment (FDI)

Back

Preview of the front of card 3

Card 4

Front

International trade

Back

Preview of the front of card 4

Card 5

Front

Free trade

Back

Preview of the front of card 5
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