Eco/212 Trade Simulation Paper

International Trade Simulation and Rep

International Trade Simulation and Report
International trade is a common denominator in today’s economy. Various countries around the world participate in importing and exporting the goods and services demanded by their citizens; requiring an abundant level of careful considerations, restrictions, limitations, and government policy. The following is an a brief discussion of the advantages and limitations of international trade, detailed analysis of comparative and absolute advantage, foreign exchange rates, and the World Trade Organization. For further insight and review, the team’s concept summaries, Trade Simulation evaluation, and International trade debate will be discussed, concluding the International Trade simulation and report.
Advantages and Limitations
Studying the effects of International trade and determining whether or not a country should consider trading is important. One of the key factors to consider is that International trade allows for healthy competition and affords consumers the opportunity to choose. Another key aspect to consider is that trade allows for a country to specialize in the production of goods best suited for them and export those goods in exchange for goods the country has a difficult time producing. In essence, International trade offers exceptional opportunities to succeed for all parties involved and provides citizens with the best possible prices on all goods. However, restrictions and limitations exist that would prevent trade from benefiting parties involved. Tariffs, a fancy word for taxes, limit imports so that domestic suppliers of a particular good have the chance to compete; a benefit when used properly. More often than not, tariffs are used as a means of punishment. When tariffs are imposed, the exporting countries believe their products are threatened and retaliate by imposing a tariff on imports from that country. Trade relations slow down until both...