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Government involvement in trade

Government involvement in trade - 1 Government involvement...

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1. Government involvement in trade a. Be comfortable with the definitions of tariff, quotas, subsidies, preferential fixed exchange rates and industrial policy. Tariff- tax levied on imports Quotas- trade restriction that sets a physical limit on quantity of good imported Subsidies- financial assistance paid to a biz/economic sector. Preferential fixed exchange rate - exchange rate is matched to the value of another single currency/value Industrial policy- plan of a country that denotes their strategic effort to influence development and the industry. b. Be able to graph a tariff and quota and discuss the numbers assigned to various points on the graph. c. Understand and be prepared to discuss the definition of the Import Substitution Strategy. It’s a trade and economic based on the premise that a country should attempt to reduce its foreign dependency through the local production of industrialized products. They wanted
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