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business level 3 unit 39 P2 M1
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- PEARSON (PEARSON)
it will help you achive P2 m1
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P2 M1Describe the mechanism that regulates internatinal traae / the methias ti increase traae between
ciuntries ana the methias ti restrict traae between ciuntries. P2 M1
Free traae
Free traae is ni restrictins in traaing with ither ciuntries. This can impact a business like Jaguar.
Fir example, cist is liwer fir Jaguar as there is ni impirt tarif in raw material impirter, raw
material is impirtant fir jaguar as steel ana cipper is the mist usea raw material in a car, ana this
pisitvely impacts Jaguar because they can liwer their iverall price fir their priauct. Mireiver
Jaguar can sell their priauct iverseas easily ana in cheaper price. Jaguar sells their priauct
internatinally which means Jaguar can beneft frim this ana make mire revenue in run fir reaching
iut ti new custimers. Furthermire free traae is an aavantage ana aisaavantage fir the UK
ecinimy ana Jaguar. Fir example, it can be an aavantage fir UK ecinimy as it aecreases
unempliyment. UK specialises in fnance which means UK can take aavantage by selling their
priauct ana service that they specialises in alliwing ti UK empliy mire peiple in iraer ti sell their
giias ana services. Decrease in unempliyment helps the ecinimy as givernment will be able ti
utlise the tax given. eiwever free traae can be a aisaavantage ti the UK ecinimy because there
will be mire cimpettin frim aiferent ciuntries , having raw materials impirtea withiut tax
means that they will able ti make beter techniligy which can afect the UK ecinimy as they will be
mire aavance in business as well.
Traae barriers
Traae barrier is when traae between ciuntries is restrictea in internatinal exchange; traae barrier
is ifen enciuragea within aimestc ciuntries. Traae barriers can impact Jaguar nn many ways. Fir
example, traae barriers impact jaguar in a negatve way as Jaguar sell their priauct internatinally,
having traae barriers in EU means that impirtng giias frim ither ciuntries like China can be much
mire expansive as they will have ti pay tax ti impirt the giias ti UK making the cist if the iverall
priauct relatvely mire expensive. nn the ither hana, it can alsi be an aavantage as well as it
enciurages Jaguar ti make new giias ana services that suit the taste if aimestc ciuntries
alliwing jaguar primite their giias ana services in a mire creatve way. Mireiver traae barriers
can be a aisaavantage ana aavantage ti UK ecinimy. Fir example, it can be an aavantage ti the UK
ecinimy as it pritects the UK jibs, lical farmer will stll be able ti keep their jib ana sell fiias ti
the lical which is enciuraging sales between ciuntries ana alsi is reaucing unempliyment rate
which is giia fir the UK ecinimy, it is benefcial ti the UK as there will be mire aispisable incime
frim cinsumer making UK businesses stringer. eiwever it can alsi be a aisaavantage ti the UK
ecinimy as well because expirtng giias makes GDP stringer ana if there is traae barrier then this
means that it will be expensive fir ither ciuntries ti buy priaucts ana services frim UK making
GDP weaker.
Expirt subsiaies
Expirt subsiaies are miney given by givernment ti frms ti help them priauce giias ana services.
This pisitvely impact business like Jaguar. Fir example, jaguar will be able ti priauce giias ana
service by nit using their iwn revenue ti make giias ana service, when Jaguar ai sell their priauct
ana services ti ither fireign ciuntries, Jaguar will be able use the full revenue ti invest in ither
new giias ana services that suits fireign ciuntries ana aimestc custimers at a liwer price. This
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