3. What are the similarities and differences between international business, International Transactions and International trade? (2 pages)
3.1 The similarity between international business, international transaction and international trade are described below. International trade is voluntary exchange of goods, services, assets, or money between residents of two countries. According to Alan M. Rugman and Richard M (2000:154) International trade is the branch of economics concerned with the exchange of goods and services with foreign countries or among countries across national boundaries. Some of the basic similarity between international trade and international business are listed below: * Trade arises because of regional…show more content… The basis of international trade is: 1. Trade arises because of regional differences in production and productivity. 2. It also arises because of great variations in the location and distribution of natural resources. 3. Trade arises because some countries specialize in the production of certain goods and services and they are known by their skills. 4. extent of foreign investement : Extent of foreign investment : Foreign investment can boost trade in developing countries which lack in capital required for the development of industries and agriculture. 5. Transport: Transport : With expansions of rail, ocean and air transport, better means of refrigeration and preservation, trade has expanded. TYPES OF INTERNATIONAL TRADE What are the two Types of international trade Ans. The two type of international trade are: 1) Bilateral trade In this type of trade the exchange of commodities is between two countries. If the two countries are complementary to each other the bilateral trade will occur. 2. Multilateral trade a. In this type of trade the commodities are exchanged between many countries. b. The countries may not be complementary to each other. c. The direction of trade is diversified which means that each * The WTO deals with the rules of trade between countries * It developed from the General Agreement on Tariffs and Trade (GATT) * WTO agreements set the ground rules for international commerce * International
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