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International Trade and Financial Markets - Assignment Example

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Long before the initiation of the concept of international business, commercial activities were mostly concentrated within the boundaries of a community or a country. Comparative advantage…
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International Trade and Financial Markets
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Download file to see previous pages For instance, assume UK can experience vast harvest of grapes as compared to Brazil. On the other hand, Brazil thrives in rubber production than any other country. The concept of comparative advantage, therefore, requires the UK to engage more resources in producing grapes. On the other hand, Brazil would better engage in the mass production of rubber. The two countries would, therefore, export their abundant products to the foreign markets. That is; rubber would be exported to the UK and grapes would be exported to Brazil. The mentioned exchange process is referred to as the international trade, which is regulated by trade policies (Suranovic 2012).
Trade policies are rules that regulate the exchange of goods, services and other assets between two or more countries. Trade policies also encompass the tax rules, government incentives, and subsidies. The flow of goods, services, and other assets from one country to another is significant for the following reasons: first, it improves economic and social ties between countries. Second, international trade avails a wide variety of goods and services for the consumers. It therefore, enhances the consumer sovereignty, which is the free will of the customers to consume products and services of their interest. Third, international trade improves a country’s economic performance among other importance. The paper seeks to present a critical evaluation of the appropriateness of the trade policies in the United Kingdom (Trade Policy 2015).
The link between the United Kingdom and the international communities, specially the developing countries, is based on the following: the export and import of goods and services between UK and the developing countries, the investments activities in the developing countries, relocation to and from development countries, and offering aid to developing countries. The goods exported to the UK from the developing countries in the year 2014 ...Download file to see next pagesRead More
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