Chapter 1 Short answer essay 1. Describe the two different parts of international economics. 2. Why is the discipline of economics similar to medicine? 3. What is the economic output of the world? How is this output divided among low-, middle-, and high-income economies? 4. What is the current division of the economic output of the world in terms of the share generated by the US versus the rest of the world? How has the US share changed since World War II, and how is it likely to change in the next 20 years? 5. Describe the differences in GDP per capita among low-, middle-, and high-income economies. Give an example of each type of country. 6. How important are imports and exports in relation to the economic output of the world? 7. Why is trade in goods and services so concentrated among the high-income countries? 8. What is the term used to describe the economic output of a state? Which country in the world economy is most similar to your state in terms of economic output? 9. Describe the various components of international trade in services. How important is this trade relative to trade in goods? 10. Describe the differences between foreign direct investment (FDI) and movements of portfolio capital. 11. Explain why international trade in goods and services is becoming an increasing percentage of world economic output. 12. In the last 150 years there have been three distinct periods of world economic growth. Describe these periods and explain why studying these past episodes may be relevant to your future career.