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Advantages And Disadvantages Of International Trade

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International trade has been a topic of debate among politicians ever since our society became as global as it is today. Typically discussed is increasing the beneficial aspects of international trade, as well as reducing the negative side effects that come along with it. Although a majority of people agree that it is a significant boon to our society, there are notable drawbacks. Both of which require meticulous inspection and thought. The first of these drawbacks involves the amount of time needed for a business transaction to finish. The aforementioned is detrimental to a company by itself. However, the ramifications of the extra time needed are comparably substantial. In addition, having to wait longer for shipments to arrive means that…show more content…
One major advantage associated with trading globally comes from an increase in profits. Typically, the reasons behind purchasing raw materials from a foreign country involve the fact that the materials are cheaper to buy and ship. In turn, this reduces overall expenses and as a result, companies can sell products for less. Supply and demand dictate that when products sell for less than the product of the competition and are of equal quality, the volume sold will rise. Increase in sales, along with the decrease in price of production will ultimately increase profits. Increasing profit is the main goal for all companies, big or small. Luckily, the increase in profitably by purchasing from foreign markets also has a chain reaction on the domestic market, for the…show more content…
This is inevitable and ultimately beneficial to all parties involved. A larger percentage of companies will buy from the domestic market, domestic firms will increase their own profits, and the consumer pays less. This is the other significant advantage of international trade; it indirectly causes the domestic market to become competitive with the foreign market. A company that attempts to lower its production costs through outsourcing will unintentionally be benefitting local firms in the future. Business will eventually return to the domestic market once it is beneficial for companies to do
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