Question

Compared to other methods of international business, international trade generally results in ____ exposure to international political risk and ____ exposure to international economic conditions.

Answer 1

First blank: Higher

Second blank: Higher

Explanation: International trade refers to the exchange of capital, goods, and services among states or territories. It has a great impact on gross domestic product (GDP) of the territories involved.

However, since there is mutual dependence between the territories, the political and economic status of the states will influence there agreements and resolutions.

Hence, international trade results in higher exposure to international political risk and higher exposure to international economic conditions.