International Trade Concepts

Topics: International trade, Free trade, World Trade Organization Pages: 4 (1102 words) Published: October 4, 2010
International Trade Concepts
Shelly Hall
March 12, 2010
Robert Chase

The Simulation on International trade concepts is a study of the country of Rodamia and the decisions the leaders made regarding imports and exports for the country. While Rodamia is a fictitious country, the concepts of international trade, tariffs, quotas, and imports and exports are all applicable to the effects on the U.S. economy. This paper will discuss in detail the meaning and effect each of these concepts have on the economy.

Advantages and Limitations of International Trade

Trade is important because different countries have various quantities and types of resources, such as land, capital, labor, and businesses. Each country wants to use their resources as a source of income as much as possible. For example, a country with a great climate for agriculture would use their natural resources to grow and sell fruits, vegetables, etc. Rodamia is a large country where the largest percent of GDP comes from services. The country has roughly 4 % of its GDP in agriculture, with crops such as corn, rice, tobacco, etc. Overall, free trade is better than imposing trade restrictions; there are situations in which trade restrictions are preferred. Protecting a developing domestic industry from competition from abroad or preventing dumping are two such situations. However, as will be discussed in later sections, trade restrictions on other countries can have negative effects on the economy. Trade restrictions on imports reduces the demand for products and services from other countries.

Effects on International Trade on the U.S. Economy

According to The Trade Resource Center, “The World Trade Organization (WTO) stimulates U.S. economic growth creates good jobs and improves living standards for Americans by reducing barriers to trade, the multilateral trading system benefits American businesses, farmers and workers.” (TRC, pp 1). How does that happen? The WTO...

References: Halliburton. (2010). History of Halliburton. Retrieved March 12, 2010 from
Trade Resource Center., World Trade Organization (WTO) and U.S. Economy (2006), Business round, Retrieved March 12, 2010 from
University of Phoenix. (2009). Economics for business [Computer Software]. Retrieved from University of Phoenix, Simulation, ECO/372 - Principles of Macroeconomics website.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • International Trade Essay
  • international trade Research Paper
  • International Trade and Trade Restrictions Essay
  • International Trade Simulation and Report Essay
  • International Trade and United States Essay
  • International Trade and Comparative Advantage Essay
  • Is international trade is really free? Essay
  • International Trade Simulation: Discuss the advantages and limitations of international trade. Essay

Become a StudyMode Member

Sign Up - It's Free