Why do countries trade with each other?

Answer 1

Some countries aren't geographically positioned to have much if not any type of resources such as Oil or Timber. And some may not have the resources to make goods. All of those can be vice-versa.

Sometimes trade can be used to improve relations between countries.

Answer 2

Countries engage in international trade in order to:

• Acquire resources they don't have
• Sell resources that they have an abundance of
• Improve a relationship with Another Country

Answer 3

Companies engage in international trade to:

1. Reach new markets and increase sales.
2. Increase profit and revenue in order to be a stronger competitor in the domestic market.
3. Increase diversification to offset the seasonality of certain products (eg. no one buys umbrellas in California during the Summer).
4. Increase diversification to offset economic slumps or recessions.
5. Put excess capacity (factories that are not being used) to use.

Answer 4

1. certain products can obly be grown in certain countries therefore if other countries want that product they must trade.

2. certain countries only trade in certain currencies therfore if a country want to buy something in dollar, they will trade with America by giving them a product for American currency so they can buy of which ever country in dollars because they are not allowed to print currency which they do not use in that particular counrty.

3. increase in employment

4. goods do not have to be mixed with chemical the make them grow in an environment which is ot typical for that product (this makes the product more natural).

5. because exchange rates are different companies have to pay less to employees in other countries.

Answer 5

They would want to trade internationally in order to widen their product market, which would increase their profit margin.

Answer 6

1. Profit

2. Expanding there Knowledge

3. Greater demand internationally for there products

Answer 7

bu

Answer 8

tarrifs