We live in a globalized world. This means that every area on the planet is in contact with every other area. One way that people contact each other is through trade. Trade is the buying and selling of goods and services.
Trade between different countries is called international trade. Many companies try to sell their goods all around the world. When they send their goods to another country, they are exporting them. Many companies buy resources and other products from other countries as well. When they bring in goods from another country, they are importing them. Most countries try to export more than they import.
Many times, when goods are imported, the buyer must pay a tariff. A tariff is a tax that a government collects on imported goods. Trade that has no taxes or government interference is called free trade.
Many of the world’s countries have free market economies. In a free market economy, people decide what to produce and what to buy. However, in some countries, the government controls what is bought and sold.