AOF BGE Lesson 4 Political & Economic Systems Test

Economic development

Improving economic and social well-being to enhance GDP.

Economic growth

Increase in goods and services production over time.

Standard of Living

Wealth and material comfort available to individuals.

TPP

Multilateral trade agreement among eleven member countries.

HDI

Measurement of a country's development across various aspects.

Subsidy

Government aid to enhance industry competitiveness.

Economic indicator

Statistic providing insights into an economy's attributes.

Tariff

Tax paid on imported goods to the government.

Embargo

Total ban on specific goods to/from a country.

Quota

Government-imposed limit on imported/exported goods.

Non-tariff trade restriction

Regulatory or quota-based trade limitation.

IMF

Global financial organization for monetary system stability.

WTO

International organization promoting free trade.

GATT

Post-WWII agreement to reduce trade barriers.

Free trade

International trade without restrictions.

GDP

Total value of goods and services produced in a year.

GDP per Capita

Country's GDP divided by its population.

PPP

Adjustment to economic indicators considering living costs.

Fair Trade

Trade ensuring fair prices, ethical treatment, and sustainability.

Exchange rate

Conversion rate between two countries' currencies.

NAFTA / USMCA

Trade agreement among US, Mexico, and Canada.

Bilateral trade agreement

Trade pact between two countries.

Multilateral trade agreement

Trade deal involving three or more countries.

Why is it important to know trends of data rather than a single point in time?

It is important to know trends of data rather than a single point in time because it is a better indicator of future performance. Trends help provide context and enable us to see the bigger picture beyond individual data points, leading to more effective strategies and actions.

What groups benefit from tariffs?

The groups that benefit from tariffs are domestic companies that make similar products because it maintains the competitiveness of their product to the importer products. Tariffs can make imported goods more expensive, giving domestic companies a competitive advantage by making their products relatively less expensive in comparison. This can lead to increased sales, higher profits, and protection from foreign competition.

Why is it important to understand a country's standard of living when importing goods or services into another country?

It is important to understand a country's standard of living when importing goods or services into another country because it is crucial for determining market potential and affordability. If the standard of living is low, the population in that country you are importing your goods may not be able to afford as they may be more focused on basic needs. A higher standard of living would often mean greater purchasing power, influencing consumer behavior and market demand.