International Trade Simulation
Essay title: International Trade Simulation
What are the advantages and limitations of International Trade identified in the simulation?
An advantage is that the United States is economically tied to all the nations of the world. It appears that we (US) make the choice whether to trade with or have tariffs with other countries or not. It could be an advantage to have tariffs because we would be making money off of import, making it less competitive with others goods.
This tariff could also be a limitation for us. It causes higher consumer prices and higher revenues. To trade internationally means, we get more resources and products to choose from. It means that we can hire at cheaper wages and not worry about certain restrictions. It seems that the world is most effective when each country specialize in goods in which there is really no competition with, such as cheese, corn, watches and DVD players.
When having a comparative advantage over the other countries may be able to export its goods faster than others, although they may not be the most efficient producers. If we have the free trade, our trade barriers will decrease and we will have an improved floating market.
List four key points from the reading that were emphasized in the simulation.
It is a good choice when negotiating free trade agreements, to try to negotiate between more than one country. Our country will then have an increase in products because the demand will increase.
Know which commodities to import
Know the correct composition of trade-make sure that the country specializes in the product in which we are trying to trade. Each country has different styles or ways of dealing and producing its resources.
Trade