Term
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Definition
| The ability of one person or nation to produce a product at a lower resource cost than another person or nation. |
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Term
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Definition
| A good or service produced in a foreign country and purchased by residents of the home country. |
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Term
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Definition
| A good or service produced in the home country and sold in another country. |
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Term
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Definition
| A government-imposed limit on the quantity of a good that can be imported. |
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Term
| Voluntary Export Restraint (VER) |
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Definition
| A scheme under which an exporting country voluntarily decreases its exports. |
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Term
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Definition
| Rights, issued by a government, to import goods. |
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Term
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Definition
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Term
| General Agreement on Tariffs and Trade (GATT) |
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Definition
| An international agreement established in 1947 that has lowered trade barriers between the US and other nations. |
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Term
| World Trade Organization (WTO) |
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Definition
| An organization established in 1995 that oversees GATT and other international trade agreements, resolves trade disputes, and holds forums for further rounds of trade negotiations. |
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Term
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Definition
| The price at which currencies trade for one another in the market. |
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Term
| Foreign Exchange Market Intervention |
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Definition
| The purchase or sale of currencies by government to influence the market exchange rate. |
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Term
| Flexible exchange rate system |
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Definition
| A currency system in which exchange rates are determined by free markets. |
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Term
| Fixed exchange rate system |
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Definition
| A system in which governments peg exchange rates to prevent their currencies from fluctuating. |
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Term
| Balance of Payments Deficit |
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Definition
| Under a fixed exchange rate system, a situation in which the supply of a country's currency exceeds the demand for the currency at the current exchange rate. |
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Term
| Balance of Payments Surplus |
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Definition
| Under a fixed exchange rate system, a situation in which the demands of a country's currency exceeds the supply for the currency at the current exchange rate. |
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Term
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Definition
| A decrease in the exchange rate to which a currency is pegged under a fixed exchange rate system. |
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Term
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Definition
| An increase in the exchange rate to which a currency is pegged under a fixed exchange rate system. |
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