or this discussion, you will examine trade barriers between the United States and a specific market, and their impact on PPP, the IFE, and currency values.
First, review the required text readings and the additional resources on free trade agreements and the trade relationship between U.S. and foreign markets, PPP, and the IFE. There are some trade barriers and also trade agreements governing the movements of goods and services among U.S. and other markets. From our theory, we have learned that changes in international prices are impacted by inflation differences and their impacts on exchange rates. Both PPP and the IFE are impacted by the changes in inflation. Inflation, in turn, is impacted by trade barriers.
Next, select a specific international market for your discussion. (Hint: Think in terms of your final project. You can do part of your research in this discussion if you use the international market you have selected for expansion.)
In your initial post, address the following:
What market have you selected and what are some of the trade barriers (identify 2 to 4) between the United States and your selected market? For market selection, identify the country only by name. You do not need to provide an overview of the country.
If these trade barriers were removed, how would it impact the PPP and the IFE? Would they be more likely to hold? Please explain.
What are the impacts of trade barriers on currency values? Do trade barriers impact currency valuations? Briefly explain.