Question

"Foreign trade integrates the markets in different countries." Support the statement with arguments.

Answer 1

Foreign trade integrates the market in different countries because
1) Foreign trade creates an opportunity for the producers to reach beyond the domestic markets.
2) Producers can sell their produce not only in markets located within the country but also can compete in markets located in other countries of the world.
3) Similarly for the buyer's import of goods produced in another country is one way of expanding the choice of goods beyond what is domestically produced.
4) Choice of goods in the markets rises.
5) Prices of similar goods in the two markets tend to become equal.
6) Producers in the two countries now closely compete against each other.