How successful has import-substituting industrialization (ISI) been?
What will be an ideal response?
POSSIBLE RESPONSE: There is evidence in favor and against import-substituting industrialization. Most industrialized countries protected themselves against import competition early in their development. However, even for these countries, more protection often went to declining industries, and many infant industries never grew up. For developing countries, their ISI policies in the 1960s and 1970s imposed significant costs. Those countries that switched from ISI to a policy that encouraged exports grew at a faster pace. Strongly outward-oriented policies were more successful than inward-oriented policies.
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Inputs that can be increased or decreased in the short run are called
a. fixed inputs b. variable inputs c. economic inputs d. accounting inputs e. normal inputs
Critics of the current system of flexible exchange rates allege that it
a. promotes inflation b. promotes unemployment c. gives central banks too little discretion over their money supplies d. restricts the growth of developing countries e. gives too much financial power to industrial countries
Output per capita would grow if:
a. the number of workers grow faster than the population. b. the population grows faster than the labor force. c. there was a greater level of disposable income. d. the number of illegal immigrant workers were reduced.
Accounting profit minus implicit costs equals:
A. explicit costs. B. economic profit. C. fixed costs. D. total revenues.