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Home > Teaching Business English > Business English Lessons, Advanced Level # 246

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The share of trade in world GDP has been increasing with a shift from commodities to manufactured goods and a growing importance of intermediary goods as a result of outsourcing.

Correct answer: (b) commodities

Meaning of business term commodities
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This increase in outsourcing has been accompanied by rising income inequality (25% of which is attributable to outsourcing) and historic high rates of profits and profit share.

Correct answer: (c) attributable

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To capture greater gains from trade, countries are seeking to increase their value-added position as they expand their industrialization, but have often found difficulty in upgrading.

Correct answer: (a) capture

Meaning of business term capture
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The newly industrializing Asian countries have had success in upgrading, whereas Latin America and Sub-Saharan Africa have had difficulty (e.g., Mexico has been able to expand exports but only with a small amount of value-added).

Correct answer: (c) Sub

Meaning of business term Sub
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China's rapid rise poses an additional threat for most developing countries outside of Asia that have had trouble upgrading.

Correct answer: (b) poses

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The 1990s saw only a meager growth in per capita income outside of Asia and a rise in income inequality within countries as a result of the Washington Consensus of export-led manufacturing growth, deregulation, and liberalization.

Correct answer: (b) meager

Meaning of business term meager
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And as China participates even more fully in the global economy, developing countries will not be able to compete with China's abundant supply of cheap labor and developed infrastructure and will therefore be adversely affected.

Correct answer: (a) adversely

Meaning of business term adversely
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The increased market linkages that now characterize the global economy have caused considerable product and labor market asymmetries: many industries are now characterized by oligopolies on top and increased supplier competition at the bottom.

Correct answer: (d) asymmetries

Meaning of business term asymmetries
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It is an endogenous process that is sustainable because of barriers to entry on the top, an abundant supply of labor on the bottom, and the entry of more firms on the ground level even though many industries already have excess global capacity.

Correct answer: (d) ground

Meaning of business term ground
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This has led to a value-added squeeze for developing countries that face obstacles to industrial upgrading, pressure downstream to keep prices low because of low margins, and pressures on labor markets to keep wages low.

Correct answer: (a) squeeze

Meaning of business term squeeze
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