Question

3. Factors that influence international trade

In the 1950s, imports and exports of goods and services constituted roughly 4% to 5% of U.S. GDP. In recent years, exports have accounted for approximately 12% of GDP, while imports have more than tripled to over 15% of GDP.

Which of the following help to explain the increase in international trade and finance since the 1950s? Check all that apply.

International trade agreements such as the North American Free Trade Agreement (NAFTA)

Higher tariffs

Services such as web conferencing and teleconferencing that facilitate international meetings

Better high-speed rail lines

Answer 1

1. NAFTA or the North American Free Trade Agreement between the USA, Canada and Mexico have eased the international trade, it removed trade barriers like tariffs, quotas amoung the various sectors, and provided the framework for free and fare trade between this nations.

2. Higher Tariffs, acts as a trade barrier, they are imposed on imports in order to safeguard the local industries, for eg:- recently US imposed tariffs on steel imports from china, in order to safeguard the US heavy industries.

3. Services like web conferencing and teleconferencing has facilitated trade, it reduced the time constraints, and eased the communication between the sellers and the buyers, thus connencting nations and continents.

4. High speed railways is an example of infrastructure development, high speed freight corridors between the two industrialised cities helped in efficient supply chain mechanism.

Therefore, 1,3,4 are correct.