MGMT 1 Lecture Notes - Lecture 4: Mercosur, Product Liability, Mercantilism
18 Apr 2016
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Document Summary
Free trade - virtually no poliical or economic barriers. Issues (loss of jobs) have led to the concept of fair trade. Countries trade with each other to create mutually beneicial exchanges. Absolute advantage (adam smith) - a country can produce a product more eiciently than any other country. Comparaive advantage (david ricardo) - countries should export those products they produce most eiciently and import those products they produce least eiciently. Small businesses can paricipate in global economy (traveling can lead to ideas of new businesses) Outsourcing - purchasing goods and services from sources outside a irm rather than providing them within the company o. Us irms have outsourced payroll funcions, accouning and manufacturing for years. Ofshoring - locaing a business in another country. Imporing - buying products from another country (us, china) Exporing - selling products to another country (china, us) Balance of trade - value of exports minus value of imports (china, germany)
