International Business - Chapter 2
|Mercantilism||A country's wealth was determined by the amount of its gold and silver holdings.|
|Protectionism||Nations promoted exports by imposing trade barriers on imports|
|Absolute advantage||The ability of a country to produce a good more efficiently than another nation.|
|Comparative advantage||A country product a product better and more efficiently than it does other goods.|
|Factor proportions theory|| - Countries would produce & export goods that required resources or factors that were in great supply and, therefore, cheaper production factors.|
- In contrast, countries would import goods that required resources that were in short supply, but higher demand.