2Voluntary Trade Factors involved in Voluntary Trade Specialization Trade BarriersCurrency ExchangeControl of Supply
3SpecializationDefine: -specialization: The products a country makes best and are demand in the world market. -interdependence: A relationship between countries in which they rely on one another for resources, goods, or services.
5SpecializationEQ: How does specialization encourage trade between countries? If a country produces the goods they can make most efficiently, that country can trade them for goods made by others that cannot be produced locally.
6Trade BarriersDefinition: The prevention of free trade
7Trade BarriersPhysical Trade Barriers: (give 2 examples) -mountains -deserts -lack of rivers, bodies of water
8Trade BarriersPolitical Trade Barriers: -tariff A tax placed on goods when they are brought (imported) into one country from another country. -quota A limit to the number of amount of a foreign-produced goods that is allowed into a country. -embargo A formal halt to trade with a particular country for economic or political reasons.
9System for Exchanging Currency Define: -currency: Paper or coins that a country uses for its money supply. -international trade: Countries trading with each other to obtain resources, goods, and services. -exchange rate: A system of changing one type of currency to another.
10System for Exchanging Currency Why does international trade require a system for exchanging currency between countries? So that it is possible to buy and sell goods between nations with different types of money.
11OPECOrganization of Petroleum Exporting Countries
12OPECDefine -supply: The amount of a good or service available for sale in a market. -demand: The amount of a good or service wanted in a market.
13OPECWhat is the primary function of OPEC? To control the supply and price of oil.
14OPECGive some examples of what petroleum (oil) is used for: cars lawn mowers machinery to make plastic products
15Economic Growth 4 Factors that influence Economic Growth Labor Capital GoodsLand(resources)Entrepreneurship
16Relationship between human capital and GDP Define:-GDP:Gross Domestic ProductThe value of all goods and services produced within a country in a given year and converted into US dollars for comparison.
17Relationship between human capital and GDP -human capital The knowledge and skills that make it possible for workers to earn a living producing goods or services.
18Relationship between human capital and GDP Companies that invest in human capital are more_____________________. Countries that invest in human capital have ______________________GDP’s because_______________________profitablehigherthey invest in educating andtraining their citizens.
19Relationship between human capital and GDP Think- Pair-Share Example:
20Relationship between capital goods and GDP Define:-capital goodsThe factories, machines, and technology that people use to make products to sell.3 examples of capital goods:- oil producing technology- communications equipmentassembly line machinery
21Relationship between capital goods and GDP Companies that invest in capital goods are more__________. Countries that invest in capital goods have _________________ GDP’s because_________________________profitablehigherthey can produce more goods in a quicker and efficient way.
22Relationship between capital goods and GDP Think-Pair-Share Example:
23The Role of Oil in SW Asia Economy Another name for oil is_____________.petroleum
24The Role of Oil in SW Asia Economy Countries WITH oil in SW Asia tend to have: Countries WITHOUT oil (except Israel) tend to have:Higher GDPHigher standard of livingLower GDPLower standard of living
25The Role of Oil in SW Asia Economy Israel has very little _____. However, Israel has a ____________________ because they invested in ________ and ___________ goods for ___________ and _______________ industries.oilhigh GDPhumancapitaltechnologycommunication
26EntrepreneurshipDefine: -entrepreneur Creative, original thinkers who are willing to take risks to create new businesses and products.
27Entrepreneurship risk An entrepreneur is willing to take a_____ in order to make a________________.profit