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Some countries may have trading restrictions with a country and may import from a third country where that item is from. For example, let's say that I live in France and my government hates Spain, so France and Spain cannot trade. But I have a bunch of customers in France who want Spanish chocolate. Here comes good ol' Italy. Italy likes France and Spain and has no trade restrictions with either country, so sn enterprising businessman in Italy imports chocolate from Spain and exports it to France. Italy makes a profit, Spain sells their chocolate, and France gets their chocolate without making concessions to their arch-rival, Spain. This is just a hypothetical. France and Spain don't really hate each other in real life. And French people get their sweeties from the Swiss. Another reason is that the raw materials imported from one country might be refined in some way for export to other countries. Let's pick on some different nations this time: The United States is a third world country that grows a bumper crop of cotton every year. Nobody has any use for it in the US because there's so much of it that they can't use it all. Australia is a thriving nation of bankers and international lawyers, but their climate is not conducive to growing cotton for clothes. Enter the United Kingdom, an industrial power in the textile field. Now, the UK has a bunch of fashion designers, but nobody in the UK wears very much cotton because the weather demands wool. The UK imports cotton from the US, makes clothing out of it and sends it to Australia at a huge profit. Again, it's a hypothetical situation used for example.
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What does it mean if net exports are negative?
Net Exports (X-I) equal Exports (X) minus Imports (I). If Net Exports are negative ( X - I < 0 ) it implies that Imports must be larger than Exports. The country is importing more than it is exporting. This is also known as a Trade Deficit or a Commercial Deficit.
What does the current accounts of a country measure?
A nations current account measures how much it lends or borrows from the world. A country where imports run ahead of exports is also spending more than it produces and must borrow abroad to make up the difference.
How does a high tariff affect an economy?
Tariff is tax levied on imports and exports and it is a form of protectionist measure. High tariff on imports would have an expenditure switching effect where residents would switch from purchasing imports to goods and services produced domestically. This could also raise tax revenues of government which can be spent back on the economy in terms of unemployment benefits etc. All in all, it will raise the National Income of the economy as consumption and government spending are likely to rise (Components of Aggregate Demand). Tariff on exports would hurt export competitiveness as prices of these goods will generally rise, especially when exports are generally price elastic. This would also deter firms firm from exporting to avoid being taxed. Exports in this case will fall which affects the GDP of an economy. However for countries (eg. China) where their exports are considered cheap and is hurting bilateral ties, an increased tariff on exports could not only solve the problem but also raise tax revenue for the government.
An unfavorable balance of trade occurs?
an imbalance of trade. More going in one direction that the other.
What is the relation between globalization and national economy?
The simplest answer I can think of is that if the western or global economy declines in output (lands in recession), that for the most part countries will also decline in gross domestic product (answer) . Because output decreases in a different country whom you are trading with, exports from that country will decrease since output has declined, and imports from that country will decline since they are raking in less revenue. This has a domino effect on all countries that they are trading with. The significance of this kind of fall depends on how much that country imports/exports. If a country like Germany or China exported less it would be devastating to the global economy and our national economy would be really bad to say the least. (explanation) So the status of our economy heavily depends on the global economy because of trade.
What does it mean if net exports are negative?
Net Exports (X-I) equal Exports (X) minus Imports (I). If Net Exports are negative ( X - I < 0 ) it implies that Imports must be larger than Exports. The country is importing more than it is exporting. This is also known as a Trade Deficit or a Commercial Deficit.
What are taxes and imports and exports?
Charges a state makes people pay when goods leave or enter their country. Usually a percentage of the value of the goods. Also it is more common to apply these taxes to imports rather than exports.
What are taxes on imports and exports?
Charges a state makes people pay when goods leave or enter their country. Usually a percentage of the value of the goods. Also it is more common to apply these taxes to imports rather than exports.
How would you define balance of trade?
The balance of trade, also known as net exports, is the difference between the dollar amount of merchandise exports and the dollar amount of merchandise imports.
What are the major imports and exports of kosovo?
Albania's imports and exports come from Montenegro, Italy and Greece. I just don't know what they are trading.
Why is Canada important to the US?
It's right next to us, a large spot for tourism, and we get some exports and imports from them, and lots of our imports/exports are come from the USA. There is also major electricity stations and stuff down there
Why is US important to Canada?
It's right next to us, a large spot for tourism, and we get some exports and imports from them, and lots of our imports/exports are come from the USA. There is also major electricity stations and stuff down there
What are the main exports and imports of Denmark?
Denmark's main exports include machinery, pharmaceuticals, food products, and chemicals. Its main imports are machinery, chemicals, food products, and petroleum. Denmark also has a strong focus on renewable energy and green technology exports.
What does South Korea export and import?
South Korea import grains, oils, and steels. And they export cars, clothing, electronics, and furniture. South Korea also imports electronic equipment, engines, medical equipment, vehicles and plastics. The country also exports telecommunications, petrochemicals and integrated circuits. Sell and buy a wide range of products from every country on Export Portal.
What are the major imports and exports of Jamaica?
Jamaica is known for their imports and exports to an from Canada as sugar cane, manure, seeds, animals,tropical fruits and rum. They also export paper, cars, and manure!Some prime exports of Jamaica are: sugar, limestone, bauxite, and coffee.
What are some things Texas imports?
The top imports from Texas include crude oil from petroleum and bituminous miner, and petrol oil. Additional imports include phones for cellular networks, processors and controllers, and insulated wiring sets for vehicles.
What are the major exports of Germany?
The main exports are engineering (such as vehicles), electronics, chemicals, pharmaceuticals also financial services.Key imports include raw materials, fuel (oil and gas) and food things. To some extent Germany also imports vehicles - mainly of a lower grade than those exported.
