Business 101 Chapter 3

Importing

Buying products from another country

Exporting

Selling products to another country

Absolute Advantage

Advantage a country has producing a single good as a monopoly, or more efficiently than all others

Comparative Advantage

Country should sell to other countries its best products and buy products from products it can't produce efficiently

Tariffs

A tax on imports

Quotas

A limit imposed on imported items

Embargo

The stopping of all trade with a country

Infrastructure

A countries means of transportation routes and trade accessibility

GATT

General Agreement on Tariffs and Trade: Negotiates mutual reductions in trade restrictions

Licensing Agreement

An agreement that allows a foreign company to produce its product in exchange for a royalty

Franchising

The right to use a specific business' name and sell its products or services in a given territory

Contracting

Designating work to a third party through a contract.

Joint Ventures

A partnership between 2 or more companies for a major project

Direct Investments

Directly investing into a company

European Union

Trade agreement between the countries of Europe

NAFTA

North American Free Trade Agreement