Specific Factors and Income Distribution

Ricardian One Factor Model's assumes that every trade will benefit everyone. However, in reality, even when trade is beneficial for an economy as a whole, some groups are negatively affected. The reason for this is that trade changes the quantity of various goods and/ or services produced in each economy. Specific Factors Model was developed by Paul Samuelson …

Foreign Exchange Market

How Foreign Exchange Markets Work Market Segments 1. Interbank or Wholesale Market - Informal network of major banks and other financial institutions; - Over-the-counter (OTC); - Multiple of US$1M or equivalent in transaction size; - 24/7 non stop aggregate activity in the whole market (worldwide). 2. Client or Retail Market - Multinational corporations; - Institutional investors and money managers; - Retail …

Labour Productivity and Comparative Advantage: The Ricardian Model

In his book 'Principles of Political Economy and Taxation', David Ricardo, a British Economist said: "A Country possessing very considerable advantage in machinery and skill and which may therefore be enabled to manufacture commodities with much less labour than her neighbours, may in return for such commodities import a portion of its corn required for its …

Key Issues In International Business Finance

International financial management is extremely important for company that operates in international market. This however, leads to many risks and challenges that need to be managed properly. 1. Foreign Exchange Risk and Hedging Value of money nowadays has no intrinsic value and is based on relative trust (Fiat Money). This is due to the fact …

An Overview To World Trade

There are several determining factors that explain the intensity of transaction activities between countries and/or regions: Size of the economy (GDP) : higher GDP countries have more capability to produce and to buy (they generate more income from goods and services sold) from other countries; Location (Geography) : logically speaking, the farther away one country from the other, …