International Trade Speech

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International Trader Speech ECO/ 372 June 18, 2014 International Trader Speech Understanding the effect of international trade to the GDP (Gross Domestic Product) can be confusing and may cause an unjustified version of imports. For instance, the addition of categories of spending to get the GDP, and the subtraction of imports in the calculation; that is to say the addition is GDP (Gross Domestic Product) = C (Consumption) + I (Investment spending) + G (Government Spending) + X (Exports) – M (Imports). It is easy to jump in conclusion that Imports is negative and exports is positive because it is add to GDP. This is not the case and here is why, Imports are subtracted because C, I, G and X spending all have imports elements, which creates income for the trading partners as the exports generate income to the country home. By subtracting Imports at the end make it easier than subtracting each imports form C, I, G and X individually. (McTeer, 2013) Imports are what the country gain from international gain and the exports are what the country’s pay for the international trade. Exports are a way to pay for the imports, it is difficult to see since importers and exporters are different people with different motivations. The report on Census.gov/foreign for January, 2014 there was $192.184 billion in Export and $232.236 billion in Imports, comparing of the increase on April of $193.345 in Export and $240.581 billion in Imports. U.S continues to import more that export, it is beneficial for exporters and producers the exports their goods and services and it is beneficial for consumers the imports of goods and services. Imports benefit the trading partner’s income, is true but the net import is good for the U.S because it gain more goods and services for less. (Bureau, 2014) Bob Mc Tee, former Dallas Fed president said “We became a “net debtor country” around
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