Module 12 - Understanding Economic Activity in an International Context

Activity 1 : : Activity 2 : : Activity 3 : : Activity 4 : : Activity 5

Activity 1: Introduction

Understanding International Trade
This objective will acquaint you with the ways that countries try to protect their home market from foreign producers by limiting the types and volumes of international trade they allow.   This will assist you in understanding the types of Protection that exist (such as Tariffs), why these are used, and the associated costs and benefits of these practices.  You should also understand the benefits of international trade, and the reasons it exists.

Understanding Actions and Organizations Affecting International Trade
To master this objective, you must be familiar with categories or types of international trade, both mechanically and in terms of their effects on the domestic economy.  This would assume that you understand both important pieces of Trade legislation, and historically important trade regimes, as well as the international organizations that assist countries in managing trade and international payments.

Understanding the Effects of Trade on the Domestic Economy
Foreign trade in both goods and services, and money (foreign currencies and other monetary instruments and assets) affects the home economy in a number of important ways.  In fact, economists study the case of an Open Economy, and that of a Closed Economy separately, because in the case of an Open Economy the effect of Imports, Exports and International Monetary Flows will be a factor influencing domestic Prices, Rates of Inflation, Employment and Interest Rates.  As you complete this activity, you will come to understand the role of Trade in the determination of Prices and other economic variables at home.

Negative Practices in the Area of International Trade
Unethical and Illegal Trade Practices in the international trading arena are problematic from an economic standpoint.  The point of this Activity is for you to become familiar with the economic effects on workers, products, and consumers of practices such as Dumping, Subsidies, Predatory Pricing and other international trading practices designed to harm competitors abroad.

Activity 1 : : Activity 2 : : Activity 3 : : Activity 4 : : Activity 5