top of page

Topics

3.1 International Trade 

  • The benefits of trade

  • Absolute and comparative advantage

  • The World Trade Organization (WTO)

  • Types of trade protection

  • Arguments for and against trade protection (arguments for and against free trade)

3.2 Exchange Rates

  • Determination of freely floating exchange rates

  • Causes of changes in the exchange rates

  • The effects of exchange rate changes

  • Fixed exchange rates

  • Managed exchange rates (managed float)

  • Evaluation of different exchange rate systems

3.3 Balance of Payments 

  • The meaning of the balance of payments

  • The components of the balance of payments accounts

  • The relationships between the accounts

  • The relationship between the current account and the exchange rate

  • Implications of a persistent current account deficit 

  • Methods to correct a persistent current account deficit

  • The Marshall-Lerner condition and the J-curve effect

  • The relationship between the current account and the exchange rate

  • Implications of a persistent current account surplus 

3.4 Economic Integration 

  • Preferential trade agreements

  • Trading blocs

  • Monetary union

3.5 Terms of Trade (HL)

  • Measurement

  • Causes of changes in the terms of trade

  • Consequences of changes in the terms of trade

3. International Economics 

bottom of page