Question

What do you mean by Internal Trade? How is it different from International Trade?

Answer 1

Internal Trade refers to buying and selling of goods and services within the political bouondaries of a nation. Differences between Internal Trade & International Trade are as follows:

$\begin{array}{ccc}\text{Basis}& \text{Internal Trade}& \text{International Trade}\\ 1.\text{Geographical limit}& \text{Limited within a country with buyers}& \text{Extends beyond the geographical}\\ & \&\text{sellers from the same country.}& \text{boundary of a country with buyers and}\&\\ & & \text{sellers from different countries.}\\ 2.\text{Currency involved}& \text{Payments are made}\&\text{received in}& \text{Payments are made}\&\text{received in}\\ & \text{home currencey only}& \text{foreign currency.}\\ 3.\text{Risk}& \text{Less degree of risk is involved as}& \text{High degree of risk is involved as}\\ & \text{it is subject to the political system.}& \text{different countries have different}\\ & \text{of one single country only}& \text{forms of political system.}\\ 4.\text{Customers hetero}& \text{Various other stake holders such}& \text{Various other stake holders such as}\\ \text{generally acorss}& \text{as suppliers, employers,middlemen,}& \text{suppliers,employers and so on are from}\\ \text{kets}& \text{shareholders and so on are usually of same}& \text{different nations}\\ & \text{country}& \\ 5.\text{Business Regula}& \text{Domestic business is subject to}& \text{International business transactions}\\ \text{tions}\&\text{Policies}& \text{rules,laws}\&\text{policies, taxation}& \text{are subject to rules, laws and policies,}\\ & \text{system, to a single country}& \text{tariffs}\&\text{quotas of multiple countries}\\ 6.\text{Effect on foreign}& \text{Internal trade has no effect on}& \text{External trade has direct impact on}\\ \text{reserves}& \text{foreign reserves of a counrty}& \text{the foreign reserves of a country.}\end{array}$