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SS1: COMMERCE - 2ND TERM

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  1. Modern Trends in Retail Business | Week 1
    2 Topics
    |
    1 Quiz
  2. The Wholesaler | Week 2
    5 Topics
    |
    1 Quiz
  3. Warehouse | Week 3
    3 Topics
    |
    1 Quiz
  4. Foreign Trade (International) | Week 4
    6 Topics
    |
    2 Quizzes
  5. Tariffs & Reasons for The Imposition of Tariffs | Week 5
    5 Topics
    |
    1 Quiz
  6. Functions of Customs & Exercise | Week 6
    4 Topics
    |
    2 Quizzes
  7. Commodity Exchange | Week 7
    7 Topics
  8. Sole Proprietorship | Week 8
    2 Topics
    |
    1 Quiz
  9. Partnership | Week 9
    5 Topics
    |
    6 Quizzes
  10. Money | Week 10
    3 Topics
    |
    2 Quizzes




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Definition of Tariff

Tariffs are taxes or duties imposed on imports and exports by the government of a country.

Reason for Imposition of Tariffs or Restriction of Trade

The reasons why countries impose tariffs or restrictions on international trade include the following:

  1. To protect infant industries
  2. To generate revenue for the countries
  3. To prevent dumping
  4. To improve the balance of payments deficit
  5. To prevent the importation of dangerous goods.
  6. For employment generation
  7. To promote self-sufficiency
  8. To protect strategic industries

Evaluation Questions

1. What is foreign trade?

2. Mention types of foreign trade

3. Differentiate between Import and Entrepot trade

4. List and explain five barriers to international trade

5. State five procedures for international trade.

6 (a) Give the meaning of each of the following 

(i) Balance of Trade (ii) Balance of payments

(b) Describe four ways by which an adverse balance of payments can be corrected (SSCE, 1990)

7. List and explain five problems associated with International trade (WASSCE June, 2004) View Answer

8. (a) What is foreign trade?

    (b) Explain four ways in which foreign trade is different from home trade

    (c) State five reasons why countries restrict foreign trade (WASSCE, 2006)

View Answer

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Question 7

List and explain five problems associated with international trade 

Five problems on International trade

  1. Distance: Due to the long distance the high cost of freight is often added to the cost of imported goods
  2. Trade Restriction: Imposition of tariffs, duties, quotas, exchange control, etc., often hinder trade.
  3. Documentation: Multiple documents and administrative procedures often hinder trade.
  4. Legal System: Differences in legal systems e.g. immigration laws, customs regulations, and tariffs often hinder trade.
  5. Political Instability: Wars, disturbance, and disagreements among nations often disturb or hinder trade.

Question 8

(a) What is foreign trade?

(b) Explain four ways in which foreign trade is different from home trade

(c) State five reasons why countries restrict foreign trade (WASSCE, 2006)

a. Foreign trade: This is the trade between two or more countries. It is otherwise known as international or external trade

(b) Difference between foreign and Home trade

 

Basis Foreign Trade Home Trade
Currency Different currency The same currency
Language Different Language The same language
Form of trade Two or more countries are involved Only one country is involved
Trade restriction There is usually trade restriction It enjoys free trade

 

c. Reasons for the restriction of foreign trade

  1. To protect infant industries
  2. To correct the balance of payment deficit
  3. To prevent the importation of harmful goods
  4. To redistribute income
  5. Political reasons

 

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