5th Year Economics Test Review

These flashcards cover key concepts related to the 5th Year Economics test, focusing on definitions and trade concepts.

Globalisation

The process of increasing interconnectedness and interdependence among countries, often resulting in the exchange of goods, services, information, and culture.

Free Trade

An economic policy that allows goods and services to be traded across borders with minimal government intervention or tariffs.

Specialisation

The process by which individuals or businesses focus on a limited set of tasks or products to gain efficiency and productivity.

Customs Union

A trade agreement between countries where they agree to charge the same import duties and allow free trade among themselves.

Exchange Rate

The value of one currency in relation to another currency, determining how much of one currency can be exchanged for another.

Trade Barriers

Government-imposed restrictions on international trade, such as tariffs, quotas, and subsidies, aimed at protecting domestic industries.

Managed Exchange Rate System

A system where a country's currency value is maintained within a target range by the government or central bank, through interventions in the foreign exchange market.

Flexible Exchange Rate System

A system where currency values fluctuate based on supply and demand in the foreign exchange market, with little to no government intervention.