Chapter 9 Global Markets (1)

Mercantilism

An economic theory that suggests exporting is good and importing is bad, measuring national wealth in gold and silver.

Absolute Advantage

The ability of a country to produce a good more efficiently than another country, leading to specialization.

Comparative Advantage

A country's ability to produce a good at a lower opportunity cost than another country.

Smoot-Hawley Tariff Act

Legislation signed in 1930 that raised tariffs on over 20,000 goods, leading to significant reductions in American imports and exports.

Balance of Trade

The difference in value between a nation's imports and exports.

Gross Domestic Product (GDP)

The total output of goods and services produced within a country, a measure of overall economic performance.

Trade Barriers

Government-imposed restrictions such as tariffs, quotas, and embargoes that limit trade between countries.

Cultural Relativism

The concept of defining business practices as right or wrong based on differing moralities within cultures.

World Trade Organization (WTO)

An international organization that promotes free trade by negotiating trade agreements and reducing trade barriers.

Customization vs. Globalization

The debate on whether to tailor strategies for different countries (Customization) versus using a standardized approach globally (Globalization).

Regional Trade Alliances

Agreements between countries to facilitate trade, examples include NAFTA, EU, and APEC.

Embargo

A government order that restricts trade with particular countries or the exchange of specific products.

Quota

A limit on the amount of a specific good that can be imported into a country.

Interdependence in Global Marketing

The reliance of countries on each other for goods, services, and political agreements influenced by cultural differences.

Economic Forces

Factors affecting the economy, including trade balance, GDP, and market stability.