Which of the following describes the national security argument for protectionism?
A) Nearly all industries can make some claim to strategic importance so such trade restrictions can get out of hand.
B) Increases in economic surplus outweigh the decreases in consumer surplus that result from protectionism.
C) Some goods should be insulated from foreign competition to ensure an adequate supply of these goods in the event of an international conflict.
D) Private companies (for example, Coca-Cola) should not be forced to reveal their trade secrets to foreign companies.
Answer: C
You might also like to view...
The advantage of imposing a tax on the producer that generates pollution is that
A) it will eliminate pollution. B) the government can keep tabs on exactly what is produced in an industry. C) a producer can pass the cost of pollution to the victims of the pollution. D) it forces the polluting producer to internalize the external cost of the pollution.
For a firm that can effectively price discriminate, who will be charged a lower price?
A) buyers that are members of the smallest market segment B) customers who have an elastic demand for the product C) buyers that are members of the largest market segment D) customers who have an inelastic demand for the product
An increase in a country's money supply causes
A) its currency to appreciate in the foreign exchange market while a reduction in the money supply causes its currency to depreciate. B) its currency to depreciate in the foreign exchange market while a reduction in the money supply causes its currency to appreciate. C) no effect on the values of it currency in international markets. D) its currency to depreciate in the foreign exchange market while a reduction in the money supply causes its currency to further depreciate. E) its currency to depreciate in the domestic market and appreciate in the foreign market.
An externality exists when
A) goods are sold in specific geographic locations. B) some of the benefits or costs associated with a good are borne by third parties. C) the government taxes a good. D) the government subsidizes a good.