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Unformatted text preview: most productive and efficient. In this way, trade often raises the standard of living of both producers and consumers. International trade also has a dark side. This SparkNote will address many of the questions about international trade that are probably looming in your mind. Why should countries trade? How does trade work? What is the effect of international trade? How do exchange rates affect trade? Can the government interfere in free trade? What is the trade deficit? The benefits and pitfalls of trade affect the economy at its core. Everything from output to standard of living to interest rates remains under the partial control of international trade. By understanding international trade, we will uncover one of the most important real life applications of macroeconomics....
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- Fall '08