Friday, February 3, 2012


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reflecting technological advances that have made it easier and quicker to complete international transactions�both trade and financial flows. It refers to an extension beyond national borders of the same market forces that have operated for centuries at all levels of human economic activity�village markets, urban industries, or financial centers. The United Sates economy began to fall after World War II. A recession in businesses in 1 became even more serious with the crash of the New York Stock Market. Also, with the Hawley-Smoot Tariff Act passed in 10, tariff rates on imported goods raised to an all time high. International trade was threatened. This and other chain reaction events made the depression more intense. For example, banks closed one after the other from a large withdrawal of money. Cash flow decreased and unemployment rates jumped to more than 5% of the working population. It is said that World War II solved the Great Depression because since then, we have not experienced another depression.

The richest countries are not rich in every aspect. For example, China’s Gross Domestic Product, the measure of the output of all goods and services within the country, was $4.8 trillion in 18. China ranked second highest in GDP and with $8. trillion in GDP, the United States ranks first. However, the Gross Domestic Product per capita (total output per person) in China is $,800; compared to the United States per capita, $,00. Further more, Japan ranks lower than China in GDP but higher in per capita. Rich could mean how well the residents in the county live. Purchasing power parity takes all currencies and compares them to a common denominator such as the dollar. This tells us whether a currency in a country is undervalued or overvalued.

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