4.1.2 international trade and business growth

specialisation

process of concentrating on and becoming expert in a particular subject or skill

comparative advantage

ability to carry out a particular economic activity more efficiently than another country

benefits of specialisation

lower costs via economies of scale

stronger competitive advantage

attracts global investment

higher productivity and GDP growth

downsides of specialisation

over reliance on a single industry

risk pf being outcompeted

structural unemployment

diseconomies of scale

FDI

means that a business from one country decides to establish themselves in another countrye

exchange rates

measures quantity of foreign currency that can be bought with one unit of domestic currency