Chapter 1 - How are countries affected by the international...

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Chapter 1 International Economics is divided into three parts: 1. International Trade . This part deals with the international exchange of goods and services . It answers questions such as: Why do countries trade? Gains? What goods do they trade and why? For example, why does Japan specialize in exporting manufactured goods and importing food and raw materials? These questions are explained through the trade models of comparative advantage in chapters 3, 4, and 5. How does trade affect jobs and earnings in the national economy? Chapter 10. Should trade be regulated by tariffs, quotas. ..etc? (c ommercial policy ). Chapters 6, 7 and 8.
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Unformatted text preview: How are countries affected by the international flow of labor and capital? Should they form trading arrangements? Chapter 9. 2. International Finance . This part deals with international exchange of financial assets . Issues that are studied include: Balance of payments. Chapter 12. Exchange rate determination. Chapters 13 16. International banking, international debt and international risk. Chapter 20 3. Open Economy Macroeconomics . This part deals with the effect of monetary and fiscal policies on the national economy in the presence of fixed and flexible exchange rates. Chapter 21....
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