1. Trade and Economic Growth
SW Asia Unit 3

2. Voluntary Trade Factors involved in Voluntary Trade Specialization
Trade Barriers
Currency Exchange
Control of Supply

3. 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.

4. Specialization Think- Pair-Share
Example:

5. 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.

6. Trade Barriers
Definition: The prevention of free trade

7. Trade Barriers
Physical Trade Barriers: (give 2 examples) -mountains -deserts -lack of rivers, bodies of water

8. 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.

9. System 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.

10. 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.

11. OPEC
Organization of Petroleum Exporting Countries

12. OPEC
Define -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.

13. OPEC
What is the primary function of OPEC? To control the supply and price of oil.

14. OPEC
Give some examples of what petroleum (oil) is used for: cars lawn mowers machinery to make plastic products

15. Economic Growth 4 Factors that influence Economic Growth Labor
Capital Goods
Land(resources)
Entrepreneurship

16. Relationship between human capital and GDP
Define:
-GDP:
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.

17. Relationship 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.

18. Relationship between human capital and GDP
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.

19. Relationship between human capital and GDP Think- Pair-Share
Example:

20. 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

21. 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.

22. Relationship between capital goods and GDP Think-Pair-Share
Example:

23. The Role of Oil in SW Asia Economy
Another name for oil is_____________.
petroleum

24. 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

25. 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
capital
technology
communication

26. Entrepreneurship
Define: -entrepreneur Creative, original thinkers who are willing to take risks to create new businesses and products.

27. Entrepreneurship risk
An entrepreneur is willing to take a_____ in order to make a________________.
profit

28. Entrepreneurship Think-Pair-Share
Example

29. Answer EQ’s
Paragraph form- use all of the vocabulary that are in your graphic organizers:
What factors encourage economic growth?
What factors encourage trade between countries?