International Trade, the EU, and Development Economics

Question-and-answer flashcards covering Dutch import and export, EU free movement, the euro, definitions of wealth, national income, issues in developing countries, and types of development aid.

What is the selling of goods and services to foreign countries called?

Export (also known as "uitvoer").

What is the buying of goods and services from foreign countries called?

Import (also known as "invoer").

Give three main categories of Dutch export products.

1) Agricultural goods (vegetables, fruit, dairy, meat, eggs) 2) Machinery and electronic equipment (e.g., chip-making machines) 3) Chemical products (e.g., paint, medicines).

State two reasons Dutch firms choose to import goods.

Better quality or lower-cost production abroad; access to raw materials or crops not available in the Dutch climate; broader product choice for consumers.

What do we call the currency of a non-euro country when it is exchanged for euros?

Foreign currency ("vreemd geld").

Define an open economy.

An economy that, relative to its size, both imports and exports a large share of goods and services.

Define a closed economy.

An economy that, relative to its size, imports and exports very little (e.g., North Korea).

Which EU freedom lets people move, work, or study in other member states without special permits?

The free movement of persons.

What term describes government measures designed to restrict imports?

Protectionism ("protectie").

What is trade called when goods flow without protectionist barriers such as extra taxes or quotas?

Free trade.

How many EU member states currently use the euro, and what collective term describes them?

Twenty countries form the Eurozone.

Give two advantages of the euro for consumers and firms.

1) Easier price comparison across countries 2) No need to exchange currencies, so no exchange-rate costs.

In economics, what is meant by "wealth" (welvaart)?

The degree to which people can satisfy their material needs and wants through what they can buy.

What is national income?

The sum of all incomes earned within a country in a given period.

How do you calculate income per capita (income per head)?

Income per capita = National income ÷ Number of inhabitants.

Why can national income alone be misleading when comparing welfare between countries?

Countries differ in population size; dividing by inhabitants (income per capita) gives a fairer comparison.

What is a vicious circle in the context of developing countries?

A self-reinforcing chain where one problem (e.g., undernutrition) causes another (poor health), which in turn worsens the first, trapping a country in poverty.

What is development cooperation?

International support aimed at raising welfare in developing countries through money, knowledge sharing, and fair treatment.

Distinguish between emergency (relief) aid and structural aid.

Emergency aid provides immediate necessities (food, water, tents, medicine) in crises; structural aid funds long-term improvements such as schools, vaccinations, clean sanitation, or better farm equipment.

What is meant by "Fairtrade"?

A trading system that guarantees farmers in developing countries a higher, more stable price for their products, enabling better living standards.