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International trade

• Presented TO: Sir Khurram Shahzad



• Presented By: B8

• Informatics
International Trade
• The exchange of goods and services
between two or more countries or
the companies & persons of
different countries.

• Degree is important rather then the
kind between home & international
trade.

Theory of International
Trade
• The division of labor & specialization.
• Comparative advantage is base of
international trade.
• Cheapest commodities are
demanded by people.
• Persons trades live in different
countries.

Important Points
• Mobility of labor and capital.

• Barriers of international trade.



• Currency difference.

Advantages of International
Trade
• Economy used in productive
resources.
 specialized goods are produced.
• Wider range of commodities.
 Every economy or market is
accessible and can be utilized for the
cost purposes.
• Scarcity of commodities.
 commodities can be imported from
other countries to overcome the


• Promotes competition.
 Prices remains reasonable due to
competition in international trade.
• Speedy industrialization.
 Machinery & other capital
equipment can be easily acquired.

• Extension of means of transport.


 Communication and transport
means are extended in the country
involved in international trade.
• Fall of Prices.
 Prices remain reasonable due to
exports of surplus commodities


Disadvantages of International
Trade
• Exploitation of resources.
 Resources are exploited by MNCs
and international tycoons.
• Effect on domestic industries.
 May have negative impact on
domestic industry
• Effect on consumption habits.
 The harmful & injurious commodities
are imported for profits.