AICET for CITS key terms

The principle that a country gains from trade by specialising in goods it can produce at a lower opportunity cost than its trading partners, even if it is less efficient at everything overall.

The ability of one producer or country to make more of a good with the same resources, or the same amount with fewer resources, than another producer.

The value of the next best alternative given up when a resource is used for one purpose instead of another; the true cost of a choice in trade theory.

A curve showing the maximum combinations of two goods an economy can produce when all resources are fully and efficiently employed, given current technology.

The ratio at which a country's exports exchange for its imports, usually expressed as an index of export prices divided by import prices times one hundred.

The difference between the value of a country's visible exports and visible imports over a period; a surplus occurs when exports exceed imports, a deficit when imports exceed exports.

A tax levied on imported goods, usually calculated as a percentage of the customs value, raising the domestic price and protecting local producers from foreign competition.

Any restriction on imports other than a tax, such as quotas, licensing rules, technical standards or health certificates, that limits the volume of goods entering a market.

A physical limit on the quantity of a particular good that may be imported or exported during a stated period, often administered through licences.

Concentration of production on a narrow range of goods or tasks so that efficiency rises through repetition, skill and scale, with other needs met through exchange.

Splitting a production process into separate tasks performed by different workers, which raises output per worker but can reduce flexibility and job satisfaction.

Reductions in average cost per unit that arise as output expands, from spreading fixed costs and from more efficient large-scale machinery and purchasing.

Selling exported goods in a foreign market below their normal value or below the cost of production, often to dispose of surplus or to capture market share.

An extra import duty imposed after investigation to offset injury caused by goods sold below normal value, calculated to bridge the gap between normal and export price.

The WTO rule that a trade advantage granted to one member must be extended to all members, so that members are not discriminated against by each other.

A group of countries that remove tariffs and quotas among themselves while each keeps its own separate tariffs against non-members.

A free trade area plus a common external tariff, so members trade freely internally and apply identical duties to goods arriving from outside the union.

Criteria used to decide the country in which a good was substantially produced, determining whether it qualifies for preferential tariff treatment under a trade agreement.

A document certified by an authorised body stating the country in which goods were wholly obtained or sufficiently processed, required by customs for duty and preference claims.

A document issued by a carrier acknowledging goods received for shipment, acting as a contract of carriage, a receipt and, when negotiable, a document of title.

A bank undertaking to pay a seller a stated sum against presentation of specified documents within a fixed period, provided the terms and conditions are exactly met.

An unconditional written order from one party to another to pay a fixed sum on demand or at a stated future date, widely used to finance international trade.

A bill of exchange payable immediately on presentation to the drawee, as opposed to a usance or term draft payable after a stated period.

Standard international trade terms published by the ICC that define who arranges and pays for carriage, insurance and customs clearance, and where risk passes between seller and buyer.

An Incoterm under which the seller makes goods available at its own premises and the buyer bears all costs and risks of collection and onward carriage.

An Incoterm for sea carriage under which the seller delivers goods on board the vessel at the named port, bearing costs and risk up to that point.

An Incoterm under which the seller pays freight and marine insurance to the named destination port, while risk passes to the buyer when goods are loaded on board.

A customs document filed by the exporter declaring goods intended for export, containing details of value, quantity, destination and the export scheme claimed.

The tax charged by customs on goods crossing a border, assessed on the declared value or quantity according to the applicable tariff schedule.

The value of imported goods determined under valuation rules, to which the rate of duty is applied; it normally includes freight and insurance where the law requires.

A refund of duty paid on imported inputs that are later exported in finished form, designed to keep export prices competitive in world markets.

Entry of goods without payment of customs duty, permitted under specific provisions such as bonded warehouses, export promotion schemes or diplomatic concessions.

A secured storage place approved by customs where imported goods may be kept without payment of duty until they are cleared for home use or re-exported.

A measuring instrument with a main scale and a sliding vernier scale, used to measure external and internal dimensions and depths to a least count of usually 0.02 mm.

The smallest measurement an instrument can read reliably, found for a vernier by dividing the value of one main scale division by the number of vernier divisions.

A precision instrument using a calibrated screw and thimble to measure small thicknesses and diameters, typically reading to 0.01 mm with a ratchet to control pressure.

A reading shown by an instrument when the true measurement is zero, caused by wear or misalignment, which must be added to or subtracted from every reading taken.

The fine irregularity of a machined surface measured as average deviation from the mean line, expressed in micrometres and specified by a roughness symbol on drawings.

The permitted difference between the upper and lower limits of a dimension, allowing a part to be made within an acceptable range without affecting its function.

The intentional difference between the sizes of two mating parts, equal to the minimum clearance or maximum interference intended by the designer.

The relationship between the sizes of a shaft and a hole assembled together, described as clearance, interference or transition according to the limits chosen.

A standard system of tolerances and deviations for holes and shafts that allows interchangeable manufacture, with holes graded as H and shafts as h for basic sizes.

A method of drawing a three-dimensional object as separate views projected at right angles onto planes, using first-angle or third-angle arrangement of front, top and side views.

A projection convention in which the object lies between the observer and the plane, so the view appears on the far side and the side view is placed to the right of the front view.

A drawing that shows the interior of an object as if cut by a cutting plane, with the cut surface filled by uniformly spaced hatching lines.

A chain line with thick ends and arrows on a drawing that shows where an imaginary cut is taken and in which direction the resulting sectional view is seen.

The ruled panel on a drawing sheet giving part name, drawing number, scale, material, projection symbol and the signatures of the people who prepared and approved it.

The ratio of a length on the drawing to the corresponding real length of the object, stated as full size, enlarged or reduced on the sheet.

A tabulated list on or with an assembly drawing giving part numbers, descriptions, quantities and material specifications of every component in the assembly.

A drawing showing how several parts fit together to form a complete unit, with overall dimensions and part references instead of detailed manufacturing dimensions.