Purpose of international trade

Answer 1

International trade, or trade for any matter, is designed to allow certain people, or in this case nations to specialize. Specialization allows companies to produce products for a lower price, and the products are usually of a better quality than otherwise.

Also, these nations are able to specialize in something they are good at, and trade for other things they aren't or don't have the resources to produce.

For example, China produces a great number of the goods that the United States consumes. They are able to mass-produce these products better than the United States will. So the United States specializes in other products and we trade them for China's. This is of course ignoring the Unites States' immense trade deficit, meaning that the U.S. imports more goods than they export.

Answer 2

The Basis for International Trade

• The basis for international trade is that a

nation can import a particular good or

service at a lower cost than if it were

produced domestically

- In other words, if you can buy it cheaper than

you can make it you buy it

- This maxim is true for individuals and nations

- This is called specialization and exchange

Answer 3

International trade ensures that people from different countries benefit from goods or services that are not available locally. It also ensures that businesses get more markets for their products or services.

Answer 4

what is the basic rationale for international trade

Answer 5

to allow nations to import what they need and want.

Answer 6

International trade makes it possible for more goods to be produced and for more human wants to be satisfied than if every country tries by itself to produce everything it needs.