Issues relating to international trade

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The term paper topic will be on the issues relating to international trade. It should include facts about international trade from history, where and why it began, the ways of trade, advantages and disadvantages and the different types of international trade.

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Running head: INTERNATIONAL TRADE

International Trade
Institutional Affiliation
Date

INTERNATIONAL TRADE
Introduction
International trade refers to the exchange of goods as well as services between different
countries around the globe. In this type of trade, the world economy grows, in that prices,
demand, and supply are influenced and affected by events around the globe. For example,
political change in the Asian continent could end up resulting in a rise in the in the labor cost,
therefore leading to an increase in the cost of manufacturing for an American sneaker company
which is located in Malaysia. This could too end up in the rise of the prices of tennis shoes at a
local mall. If the cost of labor decreases, someone will have to pay for a less amount of the
tennis shoes (Hill, Smith & Vanhoonacker, 2017). People normally have the opportunity to be
exposed to different goods and services which might not be accessed or are unavailable in their
home countries through global trade. Products like food, spare parts, oil, currencies, water
services, clothes, water, wine, and jewelry are commonly found on the international market.
Different services like banking, tourism, transportation, and consultation are also readily
available on this kind of trade. The term import is used to define a product which is bought from
the global market whereas an export defines a product which is sold to the global market.
Exports and imports are usually accounted for in the balance of payments of a country’s current
account.
History of international trade
International trade has been into existence for a number of centuries as civilization spread
trade to other parts of the world. The need for countries to trade to one another arises due to the
different resources and comparative advantage varying in existence in different regions of the
world. Since innovation and technology in every field have been free for globalization, no nation

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INTERNATIONAL TRADE
which can remain to be self-sufficient and isolated from doing trade with fellow countries.
International trade began a long time ago starting with barter trade which was replaced by
mercantilism in the early 16th and 17th centuries. Liberalism came into being in the 18th
century. During this period, the Economics father, Adam Smith, wrote his famous book in 1776
entitled The Wealth of Nations. Adam Smith clearly indicated the need for product6ion
specialization, and this ended up bringing international trade to the said space. Even up to today
the comparative advantage principle which was developed by

David Ricardo remains true.

International trade has been influenced by these economic...


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