What 3 main benefits can be gained from international trade?

Тема 1

What is market?

A market is where buyers and sellers transact business for the exchange of particular goods and services and where the prices for these goods and services tend toward equality. In order for a market function properly, the quantity of goods and services demanded and supplied must be equal at some given price. Markets can be in “equilibrium” or “disequilibrium” depending on whether or not aggregate supply equals aggregate demand at the prevailing price. Markets may differ in scope and do not necessarily require buyers and sellers to meet or communicate directly with each other. Business may be transacted through the use of intermediaries as well.

There are two key points of market definition: the product market, where products group together, and the geographic market, where geographic areas group together.

The location of buyers and sellers will determine whether the geographic market is local, regional, national or international. The exchange of goods and services in the world, or global, market is known as international trade. There are three main benefits to be gained from this type of exchange.

First, international trade makes scarce goods available to nations that need or desire them. Second, international trade allows a nation to specialize in the production of those goods for which it is particularly suited.

There are two economic principles that help explain how and when specialization is advantageous. Firstly, a nation ought to specialize in the goods that it can produce more cheaply than its competitors or in the goods that no other nation is able to produce. Secondly, a nation ought to concentrate on the products that it can produce most efficiently and profitably.

The third benefit of international trade is its political effects: nations that trade together develop common interests which may help them overcome political differences.

 

Тема 2

What 3 main benefits can be gained from international trade?

The exchange of goods and services in the world, or global, market is known as international trade. There are three main benefits to be gained from this type of exchange.

First, international trade makes scarce goods available to nations that need or desire them. Second, international trade allows a nation to specialize in the production of those goods for which it is particularly suited.

There are two economic principles that help explain how and when specialization is advantageous. Firstly, a nation ought to specialize in the goods that it can produce more cheaply than its competitors or in the goods that no other nation is able to produce. Secondly, a nation ought to concentrate on the products that it can produce most efficiently and profitably.

The third benefit of international trade is its political effects: nations that trade together develop common interests which may help them overcome political differences.

 

Тема 3

What is monopoly?

Monopoly is a situation where there is a single seller in the market. The monopoly case is taken as the polar opposite of perfect competition. The monopolist has significant power over the price it charges.

Comparison of monopoly and perfect competition reveals that the monopolist will set a higher price, produce a lower output and earn above normal profits. In addition, income will be transferred from consumers to the monopoly firm. Also monopolists, being largely immune from competitive pressures, will not have the appropriate incentives to minimize costs or undertake technological change. However, a degree of monopoly power is necessary to earn higher profits in order to create incentives for innovation.

Monopolies can only continue to exist if there are barriers to entry. Barriers to entry are factors which prevent the entry of new firms into an industry.

There are some kinds of monopolies: they are monopsony, natural monopoly.

A monopsony is a market with a single buyer who has some influence over the price of his output. A natural monopoly is a situation when a single firm can serve a particular market at lower cost than any combination of two or more firms.

 

 

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Тема 1

What is market?

A market is where buyers and sellers transact business for the exchange of particular goods and services and where the prices for these goods and services tend toward equality. In order for a market function properly, the quantity of goods and services demanded and supplied must be equal at some given price. Markets can be in “equilibrium” or “disequilibrium” depending on whether or not aggregate supply equals aggregate demand at the prevailing price. Markets may differ in scope and do not necessarily require buyers and sellers to meet or communicate directly with each other. Business may be transacted through the use of intermediaries as well.

There are two key points of market definition: the product market, where products group together, and the geographic market, where geographic areas group together.

The location of buyers and sellers will determine whether the geographic market is local, regional, national or international. The exchange of goods and services in the world, or global, market is known as international trade. There are three main benefits to be gained from this type of exchange.

First, international trade makes scarce goods available to nations that need or desire them. Second, international trade allows a nation to specialize in the production of those goods for which it is particularly suited.

There are two economic principles that help explain how and when specialization is advantageous. Firstly, a nation ought to specialize in the goods that it can produce more cheaply than its competitors or in the goods that no other nation is able to produce. Secondly, a nation ought to concentrate on the products that it can produce most efficiently and profitably.

The third benefit of international trade is its political effects: nations that trade together develop common interests which may help them overcome political differences.

 

Тема 2

What 3 main benefits can be gained from international trade?

The exchange of goods and services in the world, or global, market is known as international trade. There are three main benefits to be gained from this type of exchange.

First, international trade makes scarce goods available to nations that need or desire them. Second, international trade allows a nation to specialize in the production of those goods for which it is particularly suited.

There are two economic principles that help explain how and when specialization is advantageous. Firstly, a nation ought to specialize in the goods that it can produce more cheaply than its competitors or in the goods that no other nation is able to produce. Secondly, a nation ought to concentrate on the products that it can produce most efficiently and profitably.

The third benefit of international trade is its political effects: nations that trade together develop common interests which may help them overcome political differences.

 

Тема 3

What is monopoly?

Monopoly is a situation where there is a single seller in the market. The monopoly case is taken as the polar opposite of perfect competition. The monopolist has significant power over the price it charges.

Comparison of monopoly and perfect competition reveals that the monopolist will set a higher price, produce a lower output and earn above normal profits. In addition, income will be transferred from consumers to the monopoly firm. Also monopolists, being largely immune from competitive pressures, will not have the appropriate incentives to minimize costs or undertake technological change. However, a degree of monopoly power is necessary to earn higher profits in order to create incentives for innovation.

Monopolies can only continue to exist if there are barriers to entry. Barriers to entry are factors which prevent the entry of new firms into an industry.

There are some kinds of monopolies: they are monopsony, natural monopoly.

A monopsony is a market with a single buyer who has some influence over the price of his output. A natural monopoly is a situation when a single firm can serve a particular market at lower cost than any combination of two or more firms.

 

 

Тема 4

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