1. Int’l Econ #2 Benefits of Trade

2. DUE DATES! Fri: –HTML portfolio: 1 Month Budget, Life!, Reflection –Intl Econ #1 and up Tues: textbooks –any/all make-up work W/Th: final exam

3. Trade Barriers (Restrictions) Protectionism : protect American made products by… 1.Protective Tariffs: high tariffs added to the cost of foreign made products 2.Quotas: only a certain amount of foreign made products into US

4. Problems w/ Trade Barriers Nations will retaliate w/their own tariffs & quotas Costs $ to enforce – somebody has to oversee all this! Keeps prices higher?

5. Trade as a Tool Embargos : restricted / no trade with certain countries –North Korea NO tap shoes for you! –Cuba

6. Free Trade No tariffs or other restrictions to trade

7. European Union Many Eur. countries participate in a common market – free trade, same currency (Euro) Act like the US – one large country w/50 states

8. NAFTA North American Free Trade Agreement 1990s: Canada, Mexico & US Advantages: Very controversial! –WHY?

9. Disadvantages of Free Trade Outsourcing : –American companies sending their jobs overseas where it is cheaper! –What kind of jobs can be outsourced? –Which ones will always have to be in US?

10. Intl Econ #3: Is Wal-Mart Good for America? How does W-M keep its prices low? How does free trade benefit China? How does it benefit the US? What are the drawbacks (disadvantages) of free trade?

11. Pro’s/Con’s of Free Trade: PRO: –Make products where it’s cheapest –Results in cheap products –Jobs for those in struggling areas CON: –Lose jobs in expensive areas (US) aka outsourcing –Negative externalities