1. INTERNATIONAL TRADE LEARNING OBJECTIVE 1.TO ANALYSE THE PATTERNS OF WORLD TRADE 2.TO EXAMINE THE KEY COMPONENTS OF WORLD TRADE

2. WHAT IS TRADE? TRADE IS THE EXCHANGE OF CAPITAL GOODS ( MACHINERY), CONSUMER GOODS ( TVs) AND SERVICES.

3. HOW DOES TRADE WORK?

4. COMPARATIVE ADVANTAGE IS WHEN A COUNTRY/BUSINESS CAN PRODUCE A GOOD AT A LOWER OPPORTUNITY COST (A person who has $15 can either buy a CD or a shirt. If he buys the shirt the opportunity cost is the CD and if he buys the CD the opportunity cost is the shirt. If there are more choices than two, the opportunity cost is still only one item, never all of them). HOW DOES TRADE WORK? – COMPARATIVE ADVANTAGE

5. WHATS THE PATTERN OF GLOBAL TRADE?

6. The regions whose international trade relies most on the export of primary goods are Central Africa, the Middle East, Northern Africa and South America. The lowest proportions of exports that are primary goods are from Japan and Eastern Asia WHATS THE PATTERN OF GLOBAL TRADE? – primary goods exports

7. In 2002 secondary exports made up 71% of the value of the worldwide exports of all goods and services. WHATS THE PATTERN OF GLOBAL TRADE? – secondary goods exports

8. WHATS THE PATTERN OF GLOBAL TRADE? – hi-tech goods exports

9. Improving terms of trade means earning increasing amounts for exports whilst paying less for imports. This map shows the financial gain resulting from such changes. WHATS THE PATTERN OF GLOBAL TRADE? – terms of trade