Answer the questions.

1. What does the term 'international trade' denote?

2. What concepts are at the basis of international trade? 3 What does absolute advantage mean?

4. What does comparative advantage mean?

5. Can you explain the difference between absolute and comparative advantage?

13* Say if the statements are true or false. Prove your point.

1.The term international trade denotes the voluntary exchange of goods and services between people in different nations.

2. Absolute advantage means that using the same resources one nation can produce a product at a higher cost than can a second nation.

3. At the basis of international trade are the concepts of specialization and economic interdependence.

4. Comparative advantage is the disadvantage that arises from the inability to produce a product at a lower opportunity, cost relative to other products.

5. By specializing in the production of the product it can produce most efficiently, each nation is able to make the best use of its available resources.

14* Complete the following sentences by choosing the one correct variant (a, b or c) that best completes the sentence.

1. At the basis of international trade are the concepts of_______________________.

a. well-developed means of production

b. specialization and economic interdependence

с well-tapped natural resources

2. A nation's absolute advantage is measured in relation to___________________________.

a. natural resources

b. means of production

с. other nations

3. A nation's comparative advantage is measured in relation to__________________________.

a. all the goods and services the nation produces

b. voluntary exchange of goods

с labor force

4. Brazil enjoys an absolute advantage over the United States in_________________________.

a. coal production

b. coffee production

с steel production

5. The United States enjoys an absolute advantage over Brazil in the production of_____________________.

a. manufactured foodstuffs

b. convenience goods

с manufactured goods

Unit 4. DISCUSSION

15 Study the expressions in the Useful Language box, which are used to express different language functions. The list of expressions in each function can be continued. Think of expressions which can be added to each function.

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ECONOMIC INTERDEPENDENCE AND INTERNATIONAL TRADE	\|	Useful Language

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