Presentation on theme: "Trade and Economic Growth SW Asia Unit 3. Voluntary Trade Factors involved in Voluntary Trade 1. Specialization 2. Trade Barriers 3. Currency Exchange."— Presentation transcript:
Trade and Economic Growth SW Asia Unit 3
Voluntary Trade Factors involved in Voluntary Trade 1. Specialization 2. Trade Barriers 3. Currency Exchange 4. Control of Supply
Specialization Define:-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.
Specialization Think- Pair-Share Example:
Specialization Specialization EQ: 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.
Trade Barriers Definition: The prevention of free trade
Trade Barriers Physical Trade Barriers: (give 2 examples) -mountains-deserts -lack of rivers, bodies of water
Trade Barriers Political 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.
System for Exchanging Currency Define:-currency: Paper or coins that a country uses for its money supply. -international trade: -international trade: Countries trading with each other to obtain resources, goods, and services. -exchange rate: -exchange rate: A system of changing one type of currency to another.
System 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.
OPEC Organization of PetroleumExportingCountries
OPEC Define-supply: The amount of a good or service available for sale in a market. 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. The amount of a good or service wanted in a market.
OPEC What is the primary function of OPEC? To control the supply and price of oil.
OPEC Give some examples of what petroleum (oil) is used for: cars lawn mowers machinery to make plastic products
Economic Growth 4 Factors that influence Economic Growth 1. Labor 2. Capital Goods 3. Land(resources) 4. Entrepreneurship
Relationship between human capital and GDP Define:-GDP: Gross Domestic Product Gross Domestic Product The value of all goods and services produced within a country in a given year and converted into US dollars for comparison. The value of all goods and services produced within a country in a given year and converted into US dollars for comparison.
Relationship between human capital and GDP -human capital The knowledge and skills that make it possible for workers to make it possible for workers to earn a living producing goods or services.
Relationship between human capital and GDP Companies that invest in human capital are more_____________________. Companies that invest in human capital are more_____________________. Countries that invest in human capital have ______________________GDP’s because_______________________ profitable higher they invest in educating and training their citizens.
Relationship between human capital and GDP Think- Pair-Share Example:
Relationship between capital goods and GDP Define: -capital goods The factories, machines, and technology that people use to make products to sell. 3 examples of capital goods: - oil producing technology - communications equipment - assembly line machinery
Relationship between capital goods and GDP Companies that invest in capital goods are more__________. Countries that invest in capital goods have _________________ GDP’s because_________________________ profitable higher they can produce more goods in a quicker and efficient way.
Relationship between capital goods and GDP Think-Pair-Share Example:
The Role of Oil in SW Asia Economy Another name for oil is_____________. petroleum
The 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 GDP Higher standard of living Lower GDP Lower standard of living
The Role of Oil in SW Asia Economy Israel has very little _____. However, Israel has a ____________________ because they invested in ________ and ___________ goods for ___________ and _______________ industries. oil high GDP human capitaltechnology communication
Entrepreneurship Define:-entrepreneur Creative, original thinkers who are willing to take risks to create new businesses and products. businesses and products.
Entrepreneurship An entrepreneur is willing to take a_____ in order to make a________________. risk profit
Entrepreneurship Think-Pair-Share Example
Answer EQ’s Paragraph form- use all of the vocabulary that are in your graphic organizers: 1. What factors encourage economic growth? 2. What factors encourage trade between countries?