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AQA Economics Unit 4 11th June 2013

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Reply 240

maxbillson

What is the difference between globalisation and trade? Aren't the benefits the same?

Reply 241

kelbel1

Original post by dani robin

Any ideas on how much to write on the 25 mark questions? Like roughly how many pages?

2-3 sides is plenty for this question if you are concise, including your diagrams :smile:

Reply 242

lidiya

Is that right..

1. Trade deflection is basically when a country imports from a member with the lowest tariff and then exports it to other members.. so basically they are receiving and sending the same goods and making dividends??
2. Trade creation- does this mean that when the UK joined the EU (regarding trade) they can trade freely within the EU but outside the EU say like USA there will be a tariff for UK exports?
3.Trade diversion- does it mean that the UK can now purchase goods from a high cost producer because of the entering the EU because before they used to purchase from the USA for example and it was cheaper for the UK..??

Pleaseee...tell me if this is right as I struggle to understand the difference between them! Thanks!!

Reply 243

Ahad009

I was wondering if someone could please clarify things on this topic. The EU is a customs union but is it also a single market? I was rather confused because in my book it talks about the EU being a single market and elsewhere it says it's a customs union. And how does the term 'common market' link with this? Also, if the UK left the EU, would it be leaving the customs union as well?

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Reply 244

lidiya

Anyone explain to me trade deflection, trade creation and trade diversion... PLEASEE PLEASEEEEEE.. ;((

Reply 245

Patriot Rich

Original post by maxbillson

What is the difference between globalisation and trade? Aren't the benefits the same?

Globalisation is the process of the world integrating into a single economy.
International trade is the exchange of goods and services between countries.

You can have trade without a country being particularly globalised, It's just buying and selling. Even North Korea trades for example, it's not really participating in globalisation though because what it trades is so strictly controlled.

The benefits of free trade and globalisation might be similar, but free trade doesn't always take place, trade has many forms. There could be protectionist policies in place which are not part of globalisation.

Reply 246

qr95

So most people are predicting UK joining the euro zone can someone explain briefly how to structure this , what to talk about

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(edited 10 years ago)

Reply 247

Ahad009

Original post by lidiya

I think you've got them right because that's pretty much what it says in my book. I'm not too sure myself about trade diversion, but trade creation is when the basically you've gained trade from the removal of trade barriers I.e when the UK joined the EU. But since they joined the EU, this is a customs union meaning that they have to enforce the common external tariff to outside countries that are not part of the EU. Therefore, this can also give rise to trade diversion, since the UK could have got cheaper food imports from the USA like it used to but now can't die to the tariff. This means they are forced to buy from inefficient countries like France where it's quite costly (trade, in terms of imports, with the USA has diverted to trade with France. Hope that makes sense :smile:

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Reply 248

phoebe230253

Original post by Doodledoo1

Hi, could someone please help me?? In my notes I have written that the Quantity theory of money is a monetarist explanation for inflation - but surely it leads to demand pull inflation - so why is not a Keynesian explanation for inflation????? Thanks :smile:

Hey =) this is what I think(anyone correct me if im wrong!!!)

basically quantity theory of money explains how monetarists/free-markets believe individuals spend excess money balances on goods and services which raises AD and has a direct impact on inflation as you said, but Keynesian economists say that a change in money supply does not directly affect prices, (they think this is due to the fact people don't spend all of their disposable income but they also save some).

Quantity theory of money also contributes to cost-push inflation because the increase in demand for products lead to a demand for labour (derived demand) resulting in a rise in money wages.

hope that helps!!!

Reply 249

Axion

Original post by qr95

So most people are predicting UK leaving the euro zone can someone explain briefly how to structure this , what to talk about

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Lol bro they couldnt ask that as the UK aint in the eurozone

Reply 250

qr95

Original post by Axion

Lol bro they couldnt ask that as the UK aint in the eurozone

Damn lol I meant leaving the EU

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(edited 10 years ago)

Reply 251

username614675

And I was wondering if Balance of Payments will come up, even though it came up for Econ 2 last month.....

I personally hope something on Inflation, BoP and the EU come up. Would be quite nice if Monetary vs Fiscal vs Supply Side came up too (those types of questions are just wonderful). Although that came up in Jan :angry:

Reply 252

gasgang

does anyone know what a 'pattern of world trade' question might consist of?

i don't think there has ever been one before

Reply 253

lidiya

So is it true that the aim of Common Agricultural Policy is just to promote European food supplies where this will be more efficient for the members and cheaper for trade within the EU members?