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International Trade Agreement- Dynamics and complexity

Please write a paragraph or two for each questions below, and also provide references:

"Dynamics and complexity: Do free trade agreements create uncertainties for companies' operations?"
"Should Nations Use Strategic Trade Policies?"
"Should Governments Impose Trade Sanctions?"

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Step 1
Free trade agreements create uncertainty for companies operations. When there is free trade there is a movement of factors of production. There can be availability of low cost labor requiring lowering of prices (a). There can be increased competition forcing the company to improve quality, and reducing costs. The creation of a free trade area means an elimination of tariffs, import quotas, and preferences. Uncertainty occurs because of increased competition. Foreign goods that are low priced flood into the country and can reduce the prices. Alternately, free-trade can open opportunities for marketing the company's products in a foreign country. This can improve demand ...

Solution Summary

This solution explains international trade. The sources used are also included in the solution.

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