Question

what is the difference between international trade and international finance?

Answer 1

• About International trade :
• International trade is the exchange of capital ,gooda and services across the international borders
• Thus trade between two or more countries is called as foriegn trade or international trade.
• Here,the citizens of one country exchange goods and services with the citizens of another country.
• Its aim is to increase production and standard of living of people.
• It helps cirizens of one nation to use and enjoy the possession of goods produced in other nation.
• It opens up the opportunity for develop nations whereby it raises the capacity to produce and acquire goods.
• Thus it boost up economic growth.
• So, there may be equality of prices and thereby generating more employment opportunitiea.
• By these type of trade we can improve quality of local products and also we get more multiple choices of products.
• It reduces trade fluctuations and there will be consumption at cheaper cost.
• There are three classifications as import trade, export trade and entrepot trade.
• More innovations are available.
• There is lower dependence on our local market
• Eventhough there are some risks such as risk in transit, different languages,distance,intense competition,difficulty in payments..etc
• Helps for speedy industrialisation
• Availability of large scale production

About international finance :

• its the area of study related with balance of payment and international monetary fund.
• balance of payment is the record of the value of all transactions between a country's residents and the rest of the world.,includes current account, capital account and reserve.
• IMF is an international organisation assist in the reconstruction of world's international payment system
• international finance is the branch of economics which studies the dynamics of foriegn exchange , foriegn direct investment and how these will affect international trade
• Also studies international projects and investments and about international capital flow.
• its Increasingly important as it serves world trade and foriegn investment.
• its for increasing globalisation of world economy.
• for growing market among developed countries.
• thus this is the monetary interaction between countries , focusing on foriegn direct investment and currency exchange rates.
• its goal is to acquire funds at lower cost.
• access to capital markets across world helps a nation to borrow at tough times and also lend at good situation.
• also promotes domestic investment and growth via capital import
• Also world wide cash flows can take good care against bad govt policies.

These are major differences between both

Hope you understand.