International Trade Simulation

International Trade Simulation - International Trade...

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International Trade Simulation Week 8 Day 7 Amanda Szary
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There are three different economies that Rodomia relies on; these areas are agriculture, industry, and services. This country is surrounded by neighboring countries that produce similar and different products. One of the neighboring countries is Uthania, they specialize in chocolate and candies, but they also produce things such as minerals, coal, and corn. Suntize is one of the other neighboring countries and they are the tourist attraction of the area. They also produce things such as electronics. The third neighboring country is Alfazia. They are an agrarian economy and produce things such as corn, rice and cotton. Right now the economies of the world are becoming more integrated and increasing their engagement of international trade, Rodamia is not an exception. The most obvious partners in trade would of course be Suntize, Alfazia and Uthania. By having international trade occurring between these different countries will have lots of advantages. One of these advantages that will arise is a comparative one; this is when the countries experience different cost opportunities that produce the same product. Example: China has a comparative advantage over Singapore because they produce the same agricultural goods, this has happened because China is the larger country with the larger population and more land; where Singapore is smaller with less land and a lot smaller population. Because of this China is able to produce more of the agricultural produce but Singapore has to give up this sort of produce since it has to decide which land should be devoted to which area.
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