The World Economy

Contents1.0 Introduction 1
2.1 Three gains from trading internationally 1
2.2 Free trade 2
2.3 Absolute and comparative advantage 2
2.4 Trade protectionism 3
2.5 Trade barriers 4
2.6 The role of the World Trade Organization (WTO) in the development of free trade 5
2.7 The role of the EU in promoting trade 6
2.8 The composition of the balance of payments 7
2.9 The general trends in UK trade over the last 30 years 9
2.10 The balance of payments affected by exchange rates 9
2.11 Examine two advantages and two disadvantages of the single currency for the UK. 10
2.12 Two effects on individuals and two effects on businesses of the single currency 11
2.13 Explain one characteristic of Less Developed Countries (LDCs) 11
2.14 Analysis two current issues that face LDCs. 11
2.15 Two impacts of multinationals on Newly Industrialized Countries (NIC) and LDCs. 12
3.0 Conclusion 13
4.0 References 14
1.0 IntroductionThe purpose of this report is to analyze the global economy and the key features of the global economic environment. Research and analytical data used in this report is up to date. Trade, international payments, exchange rates and economies undergoing change are the core issues to develop in this report.
2.1 Three gains from trading internationallyThere have greater range of commodities and choice for consumers. Goods from each countries and areas circulate without restriction, thus the goods chosen by customers increase and tax-free, consumers can purchase the goods they need in an appropriate price. It is why Hong Kong is called shopping paradise.Goods and services produced at lower cost. Due to the efficiency of production going up and the opportunity of the production falling down the inputs of the producers can make relatively higher outputs. Because of this point customer can be beneficiary from the fierce competition between the providers global.Trading internationally can…

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