International Trade & Economic Growth

International trade • Presented TO: Sir Khurram Shahzad • • Presented By: B8 • • Informatics

International Trade • The exchange of goods and services between two or more countries or the companies & persons of different countries. • • Degree is important rather then the kind between home & international trade. 

Theory of International Trade • The division of labor & specialization. • Comparative advantage is base of international trade. • Cheapest commodities are demanded by people. • Persons trades live in different countries. •

Important Points • Mobility of labor and capital. 

• Barriers of international trade. • • Currency difference. •

Advantages of International Trade • Economy used in productive resources.  specialized goods are produced. • Wider range of commodities.  Every economy or market is accessible and can be utilized for the cost purposes. • Scarcity of commodities.  commodities can be imported from other countries to overcome the

• • • Promotes competition.  Prices remains reasonable due to competition in international trade. • Speedy industrialization.  Machinery & other capital equipment can be easily acquired.

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• Extension of means of transport.  Communication and transport means are extended in the country involved in international trade. • Fall of Prices.  Prices remain reasonable due to exports of surplus commodities 

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Disadvantages of International Trade • Exploitation of resources.  Resources are exploited by MNCs and international tycoons. • Effect on domestic industries.  May have negative impact on domestic industry

• Effect on consumption habits.  The harmful & injurious commodities are imported for profits.