Presentation on theme: "Mrs. Samples 2009/2010 Social Studies"— Presentation transcript:
1 Mrs. Samples 2009/2010 Social Studies VOLUNTARY TRADEMrs. Samples2009/2010Social Studies
2 SS7E6a Explain how specialization encourages trade between countries SS7E6 Students will explain how voluntary trade benefits buyers and sellers in the Middle East.SS7E6a Explain how specialization encourages trade between countries
3 SpecializationEvery country can’t produce all the goods and services they needCountries specialize in producing goods and services that they can provide efficiently.They sell these goods and service to countries who need themThe money made goes to purchase goods and services the first country needs but could not produce
4 Summarize: Specialization Countries produce products they can make cheaply, sell them, take the $ and buy what they need.
5 Some countries are rich in oil but don’t have farmland to produce crops. Ex. Saudi Arabia specializes in the production and sale of oil and gas. They then take the $ from the sale of oil and gas and purchase food and technology needed to make their agriculture system more efficient Israel has little oil but the they are leaders in agricultural technology. They sell this technology to earn $ to purchase foods.
6 Q & A What is “economic specialization”? directly swapping goods from one country to another without having to use moneytrying to avoid investing in industry and technology because of the expense involvedproducing all goods and services needed for a country’s growth, so that trade with other countries is not needed.producing goods a country can make efficiently so they can trade them for goods made by others that cannot be produced locally
7 Q & A2. Saudi Arabia specializes in the production of A. oil and gas B. oil and sugar C. olive and orange D. beef and chicken
8 Q & A3. Israel specializes in A. Medical technologies B. Industrial technologies C. Scientific technologies D. Agricultural technologies
9 Compare and contrast different types of trade barriers SS7E6bCompare and contrast different types of trade barriers
10 Trade Barriers Tariff Quota Embargo Trade barriers are anything that slows down or prevents one country from exchanging goods with another country.Some are put in place to protect local industries from lower priced goods from another countryPolitical problems is another reason for a trade barrier
11 Tariff A tax placed on goods from another country Makes the imported item more expensive than a similar local product - “protective tarriff”
12 Quota Limits the amount of foreign goods coming into a country Set a specific # or amount of a particular product that can be purchased during a given time periodEx. Israel could decide that only 1500 Japanese cars could be imported that year; that would make it more likely that people would purchase Israeli-make cars
13 EmbargoAn embargo is when one country refuses to trade with another country in order to isolate the country and cause problems with that country’s economy.Ex. OPEC decided to stop all sales of oil and gas to countries supporting Israel in the 1973 Arab-Israeli war (The US was one of the countries)
14 Q & AWhat is a tariff?A tax paid by the purchaser when goods are soldA tax placed on goods coming into one country from anotherA tax placed on goods made by local craftsmen or manufacturersA tax paid when goods are shipped from one state to another in the United States
15 Q & A2. What is a quota?A decision to prevent certain goods from being importedA tax placed on imported goods when they enter the countryA tax placed on goods when they are purchased in the market placeA limit to the number or amount of a foreign-produced good that is allowed into a country
16 Q & AWhat is an embargo?A tax placed on goods coming into the country from overseasA limit to the amount of a certain good allowed into the countryA tax paid by the producer before he can sell his goods in another countryA formal halt to trade with a particular country for economic or political reasons
17 SS7E6cExplain the primary function of the Organization of Petroleum Exporting countries (OPEC).
18 OPECCreated in 1960 by some of the countries with large oil supplies who wanted to work together to regulated the supply and price of the oil they exported to other countriesThe 1st 5 countries were Iran, Iraq, Venezuela, Kuwait, and Saudi ArabiaThey determine how much oil they will produce which determines the price on the world market.The less they produce the higher the price, the more they produce the lower the price
19 Q & A Why was OPEC created? To regulate the supply and price of oil B. To design new machinery to get oil out of the groundC. To help the Palestinians in their problems with IsraelD. To keep countries that are not members from producing any oil
20 Q & A2. What happens to the price of oil when OPEC countries decides to limit production?Prices risePrices dropPrices stay the sameOil stops being sold
21 Q & A 3.Where are most of the OPEC countries located? Africa South AmericaNorth AmericaSouthwest Asia