Welcome C&E Students!
• Find a seat and settle in
• Roll Call Question: Would you rather be a
wizard (from Harry Potter) or a Mutant
(from X-Men)?
• Bell Work: Prepare for your Quiz!
– 7.2 (Taxes)
– 7.3 (Unions)
– 7.4 (Money)
– 7.5 (Business Cycle)
SHHH! Quiz in Progress
All you need is a pencil
Have a question? Ask a question!
When finished turn in your quiz to your class tray
Opportunity of the Day:
Warm Up
Economics 7.6
What is Globalization?
• People, countries and
governments exchanging ideas,
products and world views across
barriers of distance, culture and
I. Why nations Trade
A. Comparative advantage
Nations try to produce goods at a lower
cost or more efficiently than others
Nations specialize on the goods that they
produce the best, trade to get other goods
B. Global interdependence
In our globalized economy, every nation is
dependent on the rest
helps increase production among all
II. Balance of Trade
Balance of Trade- relationship b/w a nation’s
imports and exports that affects its currency
Trade Surplus- more exports than imports,
leads to a strong currency
C. Trade deficit- more imports than exports,
leads to a weak currency
D. US can maintain a high deficit because
there is a large demand for US dollars as
the int’l currency
Welcome C&E Students!
• Find your seat and settle in
• Roll Call Question: would you rather be a
rock star or a movie star?
• Bell Work:
– How is Monetary Policy different from Fiscal
– Why would the Fed want to use tight or loose
money policy?
– How is a trade surplus different from a trade
Bell Work Answers
• Monetary Policy – actions taken by the Federal
• Fiscal Policy – actions taken by the federal
government (President or Congress)
• Tight-Money Policy – want less money in the
• Loose-Money Policy – want more money in
• Trade Surplus – exporting more than you import
• Trade Deficit – importing more than you export
• Unit 7 Test is this Wednesday
– Study Guide is optional. If done receive 2 extra
points on your Unit 7 Test
– Quizzes are still due
• Extra Credit is also due this Wednesday
• Recovery!!!! Every Monday, Tuesday and
• Turn in all late work this week!!!
Warm Up – Crossword
• See how much you need to
prepare for the Unit 7 test
• Try first without your notes – feel
free to work with a partner
• When the bell rings you may take
out your notes
III. Trade Barriers
A. quota- strict limit on imported goods
B. tariff- tax on imported goods
C. subsidies- US gov’t supporting a US
industry financially
D. Protectionism1.
creating trade barriers to foreign trade in
order to make a nation’s goods more
Protectionism may restrict competition,
hurt innovation, and lead to trade wars
IV. Free Trade
A. The goal of free trade agreements are to
eliminate trade barriers
B. Advantages- competition, growth among
all, int’l specialization
C. Disadvantageseconomic
vulnerability, jobs can
be outsourced (sent
to an external
D. World Trade
Organization (WTO)negotiates new trade
agreements and
works to expand
world trade
European Union
(EU)- European
nations have
eliminated trade
barriers and created
a common currency
North American
Free Trade
(NAFTA)- goal to
eliminate barriers
b/w Mexico,
Canada, and US
V. Developing Nations
A. Developing nations
have low per capita
GDP, poor health,
infrastructure, etc
B. Free trade has helped
developing nations out
of poverty more than
economic aid
C. World Bank- lends to developing nations
to reduce poverty
D. International Monetary Fund (IMF)- seeks
to stabilize exchange rates and
encourage good economic policy
Global Trade Matching
• See how much you learned from 7.6
• Notebook check will happen this
• Review your 7.5-7.6 notes tonight
• Feel free to make a note card with
any information from these two
sections to use on whatever may
be coming tomorrow
Drop Dead Date
• All missing work (besides the review
packet) is due by Tuesday of next week. I
will not accept any work past that date.
1. How do nation’s seek to gain a
comparative advantage?
2. How can a country respond if its currency
depreciates (lowers in value)?
3. What are some consequences of
Global Trade Activity:
Number of Students
World Bank-2
USA- 2
Japan- 2
India- 5
Brazil- 5
Tanzania- 3
Mozambique- 3
• Deposits must be
in groups of 5
• Individual
products: ½ price
• Inferior goods: ½
• Colored paper:
double price
• Deposits: 10%
• Loans: 50% interest