IB Economics/International Economics

• 4.1 Reasons for trade
• 4.2 Free trade and protectionism
• 4.3 Economic integration
• 4.4 World Trade Organization (WTO)
• 4.5 Balance of payments
• 4.6 Exchange rates
• 4.7 Balance of Payment problems
• 4.8 Terms of trade

Key Terms

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Absolute advantage (HL)

Anti-dumping

Appreciation

Balance of payments (BoP)

Balance of trade (BoT)

Capital account

Capital account deficit

Capital account surplus

Common market

Comparative advantage (HL)

Current account

Current account deficit

Current account surplus

Customs union

Depreciation

Deteriorating terms of trade/adverse terms of trade

Devaluation

Dumping

Elasticity of demand for exports

Elasticity of demand for imports

Exchange rate

Expenditure-reducing policies

Expenditure-switching policies

Factor endowment

Fair trade

Fixed exchange rate

Floating exchange rate

Free trade

Free trade area (FTA)

Infant industry argument

Invisible balance

J-Curve (HL)

Marshall-Lerner condition (HL)

Protection

Purchasing power parity (PPP) (HL)

Quota

Revaluation

Specialization

Subsidy

Tariff

Terms of trade

Trade creation (HL)

Trade diversion (HL)

Voluntary export restraint (VER)

World Trade Organisation (WTO)