4.3 Arguments for and against trade protection

Open Ended

A potential limitation of using trade protection for national security reasons is...

Multiple Choice

Trade protection always leads to a welfare loss.

• True

• False

Fill in the Blanks

[

] refers to the practice of firms selling products in foreign markets at below cost prices.

Multiple Select

Reasons for trade protection include... (check all that apply)

• Enforcing environmental standards

• Correcting a deficit in balance of payments

• Improving resource allocation

• Protecting jobs in specific industries

• Raising government revenue

Multiple Choice

Which of the following is NOT a reason for imposing a tariff?

• To benefit domestic producers

• To benefit domestic consumers

• To raise government revenue

• To protect infant industries

Multiple Choice

Infant industries are protected primarily because...

• Small tariffs are beneficial for the economy as a whole

• They are essential for national security

• They benefit the environment

• They lack economies of scale

Multiple Choice

From the US' perspective, trade protection against China's currency devaluation can be justified as this is an example of _________. However, this led to ________.

• Dumping... retaliation

• Dumping... mercantilism

• Unfair competition... retaliation

• Unfair competition... mercantilism