Economy - answer✔- process or system by which hoods and services are produced, sold, and
bought in a country or region
Global Economy - answer✔- economies of countries are more connected from the extraction,
production, distribution, consumption, and disposal of goods and services
Economic Globalization - answer✔- refers to the increasing interdependence of world economies
as a result of the growing scale of cross-border trade of commodities and services, flow of
international capital and wide and rapid spread of technologies
Types of Economies under Economic Globalization - answer✔Protectionism
Trade Liberalization
Protectionism - answer✔a policy of systematic government intervention in foreign trade with the
objective of encouraging domestic production. This encouragement involves giving preferential
treatment to domestic producers and discriminating against foreign competitors
Protectionism - answer✔Comes in the forms of tariffs and quotas
Trading Blocks - - answer✔countries join together and create trade agreements or alliances
European Union (EU) & North American Free Trade Agreement (NAFTA) - answer✔- example
of the most powerful trade alliances tend to be located in developed countries
Advantages of Trade Alliances - answer✔1. Encourages trade between member countries
2. Provide a much larger market to sell goods to and make larger profits
3. Helps safeguard the industries of member countries
4. Free trade between member countries means that there are no tariffs or quotas imposed on
them. Member countries can buy goods on cheaper prices, Non-Member countries will be
charged for taxes or put on a limit on how much they can export to countries
5. Member governments also subsidize their own industries so that they can produce cheaper
materials and goods
6. The removal of border controls means that it is cheaper and easier to import and export goods
throughout different countries
7. Individual countries have more power, as they are part of the 'superpower' which has
enormous influence on the world market
Fair Trade - answer✔- the result of the pattern of world trade is that the producers of primary
products in developing countries lose out with low wages and poor standards of living. With
little money, they cannot afford essentials such as primary education for their children and many
children are required to work to help the family earn a living
Fair Trade - answer✔means that producers receive a guarantee and fair price for their products
regardless of the price on the world market. This means their quality of life should improve as
will the long-term prospects for their children
Importance of Fair Trade - answer✔a. The choices that people make about what they buy and
where to buy it from has a direct impact on global trade
b. Fair Trade ensures that the goods you buy help to remove inequalities and unfairness
Fair Trade Products - answer✔- sometimes cost a little more in supermarkets in developed
countries, but many consumers consider this a small price to pay for the benefits they bring
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