Differences between Home and International trade

////Differences between Home and International trade

Differences between Home and International trade

image credit iccwbo.org

image credit iccwbo.org

ZIMSEC O Level Commerce Notes: Differences between Home and International trade

  • Home trade is buying is the buying and selling of goods and services between people within a country’s borders ( Zimbabwe).
  • International trade involves the buying and selling of goods between people in one country (Zimbabwe) and those in other countries.
Home TradeForeign Trade
Trade is among citizens of the same countryTrade is between citizens of different countries
Short distances are involved for example Harare to BulawayoLong distances are involved for example Harare and Beijing
Fewer middlemen if any are involvedMore middlemen are involved
No/Less tariffs ( in the form of levies and taxes) may be charged since there is less state involvementMore tariffs are charged because the government may levy customs duties or trade embargoes.
Less transit risks are involved e.g. theft through piracy hence the insurance costs are lowerMore risks are involved on the way resulting in higher insurance costs
Local currency is used by citizens within the same country e.g. Zimbabwean dollar.Foreign currencies are used for example the US dollar for oil and the Euro in Europe
Citizens normally speak the same local language or official languageCitizens of different countries speak different official languages
Costs incurred in transporting goods locally are usually lowerCosts incurred in transporting goods across borders are higher.
Documents used are fewer e.g. invoices and quotationsA lot of documents are involved
Involves retail and wholesale tradeInvolves import and export trade
Uses the same units for weighing and measuring productsUses different units for measuring products for example Zimbabwe uses liters and the US uses gallons and quarts

To access more topics go to the Commerce Notes page.

 

By |2017-01-17T11:19:33+00:00July 23rd, 2015|Notes, O Level Commerce Notes, Ordinary Level Notes|Comments Off on Differences between Home and International trade

About the Author:

He holds an Honours in Accountancy degree from the University of Zimbabwe. He is passionate about technology and its practical application in today's world.
%d bloggers like this: