Global Economics

Gross World Product is the total value of all economic output of all the world's economies over a certain period of time. It is significant in the global economy as it provides a measure of the total economic activity across countries and can be used to compare the economic performance of different regions.

Relative Purchasing Power Parity (PPP) is a measure of how much different countries' prices for goods and services are equal. It is calculated by comparing the cost of a basket of goods in different countries, using a common currency.

GDP is the total market value of all final goods and services produced in a given period of time. It is used to measure economic activity as it provides a measure of the total output of an economy and can be used to compare economic performance over time or between different countries.

<p>Globalization has led to increased international integration of economies, as it has facilitated the movement of goods, services, and capital across borders, leading to increased trade and investment flows between countries.</p> Signup and view all the answers

<p>The COVID-19 pandemic and trade wars have led to a decrease in global trade, as border closures and disruptions to supply chains have made it more difficult for goods and services to move between countries.</p> Signup and view all the answers

<p>The fastest growing industry in the future is expected to be trade in finance and communication services, as technological advancements and increased global connectivity have made these industries more important for businesses and consumers.</p> Signup and view all the answers

<p>Derivatives are financial contracts whose value is linked to or derived from an underlying asset. They are used in financial markets to manage risk, speculate on future prices, and hedge against potential losses.</p> Signup and view all the answers

<p>The FOREX market is a network of buyers and sellers exchanging one currency for another. It is important in international trade as it facilitates the movement of goods and services between countries by allowing businesses to exchange currencies and manage currency risk.</p> Signup and view all the answers

<p>FDI can have a number of benefits for a country, including increased productivity, the expansion of capital stock, and the efficiency of resource use, which in turn can lead to higher output levels and increased employment levels.</p> Signup and view all the answers

<p>FDI can also have negative effects on host countries, such as crowding out local businesses, increasing income inequality, and prioritizing profit over social objectives.</p> Signup and view all the answers

<p>Technological advancements have led to lower costs of moving goods between economies, making it easier and more cost-effective for businesses to engage in international trade.</p> Signup and view all the answers

<p>The level and direction of international financial flows can determine a nation's exchange rate, as capital flows can affect the supply and demand for a country's currency and impact its value relative to other currencies.</p> Signup and view all the answers