Tariffs and other trade restrictions increase the domestic scarcity of products from abroad. Such policies benefit domestic producers of the restricted products at the expense of domestic consumers. This statement:
a. is essentially correct
b. contains two errors; trade restraints do not increase the domestic scarcity of product and neither do they harm domestic consumers.
c. contains one error; domestic producers gain at the expense of foreign producers rather than domestic consumers.
d. contains one error; the trade restraints do not increase the scarcity of foreign produced goods.
a
You might also like to view...
China's prosperity brings income gap The Asian Development Bank [ADB] reports that China has the largest gap between the rich and the poor in Asia
Ifzal Ali, the ADB's chief economist, claims it is not that the rich are getting richer and the poor are getting poorer, but that the rich are getting richer faster than the poor. Source: Financial Times, August 9, 2007 Explain how the distribution of personal income in China can be getting more unequal even though the poorest 20 percent are getting richer.
Stagflation occurs when inflation ________ and GDP ________
A) rises; falls B) falls; rises C) falls; falls D) rises; rises
Why does a patent stimulate research?
A) Patents give firms time to do research. B) Patents give firms the opportunity to recover research costs and thus serve as a profit motive. C) Without patents firms would not research as much. D) They don't.
Which of the following does free trade encourage?
A. more rapid spread of technology B. domestic industries' access to larger markets C. higher rates of economic growth D. all of these