Explain the three very important aspects of international trade.

International trade has three very important aspects.

(i) Volume of Trade- The actual tonnage of goods traded makes up the volume. However, services traded cannot be measured in tonnage. Therefore, the total value of goods and services traded is considered to be the volume of trade.

(ii) Composition of Trade- The nature of goods and services imported and exported by countries have undergone changes during the last century. Trade of primary products was dominant in the beginning of the last century.

(iii) Direction of Trade- Historically, the developing countries of the present used to export valuable goods and artefacts, etc., which were exported to European countries. During the nineteenth century there was a reversal in the direction of trade.