2. Economic System
What will be produced with our resources?
How will these goods be produced?
For whom will we produced these goods?
Four Main Types
Traditional Economy
Market Economy
Command Economy
Mixed Economy
3. Balance of Payments - is the
Stages of Market method countries use to monitor
all international monetary
Development transactions at a specific period of
time.
Current Account – account shows
High income countries the net amount a country is earning if
Upper-middle income it is in surplus, or spending if it is in
deficit.
countries Capital Account – records the net
change in ownership of foreign assets.
Lower-middle income Financial Account - international
countries monetary flows related to investment
in business, real estate, bonds and
Low income countries stocks are documented.
4. Trade in Merchandise and Services
Merchandise trade Trade in Services
Two trade concept (Mode 1) Cross border trade
Custom-based trade statistics (Mode 2) Consumption
Balance of Payments abroad
(Mode 3) Commercial
presence
(Mode 4) Presence of natural
persons
5. Overview of International Finance
Benefits
Acess to capital market
Promotes domestic investment
Worldwide cashflows
Prevents excessive domestic regulation
Regulatory Global Bodies
International Financial Corporation (IFC)
International Monetary Fund (IMF)
World Bank
Growth of International Trade
Sub Functions
Controller
Treasurer