Flashcards in Trade/BoP Deck (62)
How many jobs in Australia are export related?
What is the Australian economy ranked?
What does Australia specialise in?
Primary goods/natural resources (agriculture/minerals: coal, iron ore,natural gas)
Why did specialisation develop?
Different natural resource endowments around the world
Why does Australia specialise in what it does?
Vast mineral deposits/energy resources, large areas of arable land for crops/livestock
Endowment of natural resources
The resources possessed by a region
When will a country export or import?
Import if world price is cheaper than domestic, export if domestic price is cheaper than world.
Are imports or exports more important?
Neither; equal importance
Why is trade worth it if one group loses?
Gains exceed the losses
Why do imports increase economic welfare?
Consumer gain outweighs producer loss, overall welfare increases
How can countries consume outside their PPF?
Specialisation and trade
What are Australia's 3 largest trading partners?
USA, Japan, China
Australia's largest export partners
Japan, China, Korea
Australia's largest import partners
China, US, Japan
How much of 2-way trade do the 3 largest trade partners account for?
How much of exports do the 5 largest partners account for?
What factors affect trading partners?
Geography, political/historical links,
What is Australia's 4th largest export?
Personal travel, petroleum, passenger vehicles
What does trade do to an economy?
Boost economic development/growth, raise living standards
Exports exceed imports
Imports exceed exports, negative net exports
In the past 10 years, how many recorded a trade surplus?
Which side do exports benefit?
Which side do imports benefit?
Balance of goods
Record of all transactions between Australia and the world
Which parts of the balance of payments must be equal?
Credit & debit, current & capital/financial
What do exports depend on?
Relative competitiveness, conditions in other countries
Price of one currency in terms of another