II. Give English equivalents of the following:

3a neBHuii nepiofl aKTMBHe canbflo ToproBenb-

Horo 6anaHcy noflaTOK Ha iMnopr

3a3HaTM 36nTKiB

3a6opoHa ropriBni OKpeMMMM

TOBapaMM o6Me>neHHfl Ha ninbuicTb JMnop-ro-

BaHMX hm eKcnopTOBaHnx TOBapiB o6Me)HyBaTM MiwnapoflHy Top-

riBnio 3MiHK>BaTH HOMeHKJiarypy npoflyKU.iT

III. Fill in the blanks wffh appropriate words:

1

equal

produce

increases

deficit

fewer

less

negative

surplus

During 1989 the USA imported more than exported and so had a ... trade balance.

2. If the United States has a trade deficit with the rest of the world, then other countries must have an offsetting trade ....

3. Imports must ... exports, since every good exported by one country must be imported by another.

4. A negative trade balance is called a trade ...

5. When countries engage in international trade, they are expressing commitment to specializa­tion and the reason is: specialization ... total output.

6. Two countries that trade can together ... more output than they could in the absence of trade.

7. Imports mean ... jobs and ... income for some domestic industries.

IV. Read and translate the text:

After examining the arguments for and against international trade, we try to draw some general conclusions about optimal trade policy.

'i -^

; " i .j =*!<:-.-T-

U.S. imports represent 9 percent of total GNP. These imports include the consumer items as well as capital equipment, raw materials and food. While the country is buying goods and services from the rest of the world, foreigners are buying U.S. exports.

U.S. exports represent 7 percent of total output. As the figures indicate, U.S. imports and exports were not equal in 1989. Quite the contrary: the USA had a large imbalance in the trade flows, with many more imports than exports. The trade balance is computed as the difference between exports and imports: that is

trade balance = exports — imports.

During 1989 the USA imported more than exported and so had a negative trade balance. A negative trade balance is called a trade deficit.

If the United States has a trade deficit with the rest of the world, then other countries must have an offsetting trade surplus. On a global scale, imports must equal exports, since every good exported by one country must be imported by another.

When countries engage in international trade, they are expressing the commitment to specialization, and the reason is: specialization increases total output.

Two countries that trade can together produce more output than they could in the absence of trade. So, the gain from trade will be increased world output and thus a higher standard of living in both countries.

Although the potential gains from world trade are perhaps clear, we must recognize one central fact of life: some producers have a vested interest in restricting international trade. Micro-economic resistance to international trade arises from the fact that imports mean fewer jobs and less income for some domestic industries. Exports represent increased jobs and incomes for other industries. Thus on a microeconomic level there are gainers and losers from international trade. Trade not only alters the mix of output but also redistributes income from import-competing industries to export industries.

Resistance to trade emanates from workers and firms that must compete with imports. Even though the country as a whole stands to benefit from trade, these individuals and companies may lose jobs and incomes in the process.

The means of restricting trade are many and diverse. Embargoes are outright prohibitions against import or export of particular goods. Quotas limit the quantity of a good impor-

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ted or exported. Tariffs discourage imports by making them more expensive. Trade-adjustment assistance is a mechanism for compensating people who incur economic losses as a result of international trade, thus it represents an alternative to trade restrictions. To summarize: International trade permits each country to concentrate its resources on those goods it can produce efficiently. This kind of productive specialization increases world output.