Assignment BX3021 - Assignment BX3021 Question 1 Synopsis...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Assignment BX3021 Question 1: Synopsis of Trade Theories Mercantilist theory: A political and economic policy seeking to advance a state above others by accumulating large quantities of precious metals and by exporting in large quantity while importing in small. Absoloute advatage: The name for the ability of one entity to engage in more efficient production than another entity. Assuming equal inputs, the entity with an absolute advantage will have a greater output. Comparitive advatage: the ability of one business entity to engage in production at a lower opportunity cost than another entity. Comparative advantage, rather than absolute advantage, is useful in determining what should be produced and what should be acquired though trade. Heckscher-Ohlin theory: differences in relative factor endowments among nations underlie the basis for trade Product Life-Cycle Theory: This theory states how a country's export can later become its import through different stages in the product life cycle; New Product stage, Maturing Product stage and Standardized Product stage New Trade theory: is the economic critique of international free trade from the perspective
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 01/17/2012 for the course BUSINESS BU2005 taught by Professor Smith during the Three '10 term at Bond College.

Page1 / 2

Assignment BX3021 - Assignment BX3021 Question 1 Synopsis...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online