This document discusses international trade. It defines international trade and classifies its types, which include direct business, consignment business, and indent firms. It describes characteristics of international trade such as territorial specialization and government control. The document outlines importance, benefits, and barriers of international trade. It discusses reasons for companies to engage in global trade, as well as problems and advantages/disadvantages. Finally, it explains Adam Smith's theory of absolute advantage in international trade.

1. INTERNATIONAL
TRADE
Presented By : Muntaha Maqbool
(2023-M-BE- 011)

2. What is International Trade?
• What is the project about?
• Define the goal of this project
• Define the scope of this project

3. Classification Of International Trade

4. Types Of International Trade
• the importer places order with
manufacturer of the exportingcountry
Direct Business
• exporter sends the goods to an agent in
the importing country
Consignment
Business
• charge a commission for their services
Indent Firms
• buy goods on their own account and
sell them in a foreign countryat a profit
Merchant
Shippers

5. Characteristics Of International Trade
Territorial
specialization
International
competition
Separation of
sellers from
buyers
Long chain of
middlemen
International
rules and
regulations
Mutually
acceptable
currency
Government
control
Several
documents

6. Importance Of International Trade

7. Benefits

8. Barriers Of International Trade
Cultural and social barriers
Political barriers
Tariffs and trade restrictions
Standards
Boycotts
Anti-dumping Penalties
Monetary Barriers

9. Reasons For Growing
Globally
Reduced
dependence
on your local
market
Increased
chances of
success
Increased
efficiency
Increased
productivity
Economic
advantage
Innovation
Growth

10. Problems
Of
International
Trade

11. Advantages And Disadvantages

12. Theory Of Absolute Advantage
Ability of a country, individual, company or
region to produce a good or service at a lower
cost per unit than the cost at which any other
entity produces that same good orservice.
According to Adam Smith. if one country has absolute
advantage over another in one line of product on and
the other country has an absolute advantage over the
first country in another line of production. then both
countries would gain by trading.

13. Advantages Of Adam Smith Theory
Trade between two
countries would
be mutually
beneficial if the
cost of producing a
commodity in one
country is lesser
than the cost of
producing the
same commodity
in anothercountry.
Absolute Cost
Advantage
A country would
produce those
goods that are
naturally favoring
its climatic
conditions. The
type of goods
produced would
also depend upon
the availability of
natural resources.
Natural
Advantage
This would include
advantage in
technology and
level of skill
development.
Acquired
Advantage