OCR A-Level Geography H481
Coastal Landscapes
Glaciated Landscapes
Dryland Landscapes
Earth’s Life Support Systems
Changing Spaces; Making Places
Trade in the Contemporary World
Global Migration
Human Rights
Power and Borders
Climate Change
Disease Dilemmas
Exploring Oceans
Future of Food
Hazardous Earth
Geographical Skills
Trade in the Contemporary World
Trade as a driver of growth, stability and development
- 3 things to know
- Component 02
Overview
Recall questions on comparative advantage and David Ricardo, specialisation, lower consumer prices, the multiplier effect of export industries, technology transfer, remittances, trade and political stability through the European Coal and Steel Community, export earnings, export processing zones, the spread of ideas, and global trade rules.
What you need to know
Answer each one before you reveal it.
Which economist first set out the theory of comparative advantage?
How does international trade lower prices for consumers?
Questions from this subtopic
Each one with the model answer underneath.
- 1
What is comparative advantage?
Model answer
Comparative advantage is a country's ability to produce a good at a lower opportunity cost than another country, which is the basis of the gains from specialisation and trade.
- 2
Which economist first set out the theory of comparative advantage?
Model answer
David Ricardo set out the theory of comparative advantage in the early nineteenth century.
- 3
Explain how specialisation between countries raises total world output.
Model answer
Each country concentrates on what it produces relatively most efficiently, so the same resources yield more goods overall, and trade then lets every country consume beyond what it could produce alone.
- 4
How does international trade lower prices for consumers?
Model answer
Competition from imports and access to lower-cost overseas producers push prices down while widening the range of goods available.
- 5
What is the multiplier effect of an export industry?
Model answer
Money earned by exporters is respent on local wages, suppliers and services, so each unit of export income generates further rounds of spending, income and jobs in the local economy.
- 6
Explain how trade transfers technology between countries.
Model answer
Foreign firms bring machinery, technical standards, management systems and training when they invest or subcontract, and local suppliers must adopt those methods to keep their contracts.
Other ways to work this
The same content, four other ways.
What is inside Levo
Six ways to work the same material.
Every question in Trade in the Contemporary World, on a schedule.
Attempt a question from memory, write the correct version, then attempt it again. Levo records the jump between your first attempt and your last, and brings each question back on the day you are due to forget it.
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