1. Understand Gross National Product (GNP) and Gross Domestic Product (GDP).
GNP- term traditionally used to explain a country’s relative level of development. It is the value of average annual output of domestic residents including output produced outside the country. Does not include output of foreigners who are producing within the country. Per Capita GNP= GNP/ # of citizens in the population (it shows the relative rate of production per citizen).
GDP- alternative method of measuring the economic activity of nations. Represents the market value of annual output of products and services produced within a country. Unlike GNP, it includes contributions of migrant workers and other foreigners employed within a country and excludes profits made by domestic firms from activities they completed in other countries.
2. the definitions of exports, imports, and trade balance
Exports- represent goods shipped for import to another country in exchange for money, other goods, or jobs. Result in revenue accruing to firms in the countries where the goods originated.
Imports- make goods available domestically or materials available for domestic production because of exports from another country.
Trade balance= exports-imports. The difference between imports and exports for a region or country.
Trade surplus- means there is a positive trade balance (value of exports exceeds value of imports- China)
Trade deficit- means there is a negative trade balance (value of imports exceeds value of exports- US)
3. what do the abbreviation terms such as NAFTA, NAICS, HTS, HS, SIC, and SITC stand for, respectively?
NAFTA- North American Free Trade Agreement. Eliminated tariffs and quotas among Canada, Mexico, and US.
NAICS- North... [continues]
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