"Globalization and the World Economy"

Exchange Rates Balance of trade

• Currency depreciates (decreases in value)- export more goods due to other countries being more willing to buy at the “lower price”
• Currency value increases- import more goods due to foreign goods “costing less”
• Trade Surplus- export value is higher than import value
• Trade Deficit- import value is higher than export value

Major US Imports and Exports

• Crude Oil
• Electronic equipment
• Cars
• Precious Metals and Gems
• Food Products
• Electronic Equipment
• Cotton
• Vehicles

Potential Short-Answer Questions

• What are some causes for Globalization
• Why do companies produce their goods outside of their home country?
• How are trade patterns established?
• How can the US Dollar exchange rate affect our economy?