Y11 Economics - C37 Free Trade and Protection

What is globalisation?

• The increase of tariffs on imports

• The process of becoming interconnected through trade

• The decline of multinational companies

• The act of protecting domestic industries

Which of the following is a reason for increasing globalisation?

• High import tariffs

• Reduced transport costs

• Limited communication technology

• Increased local production

What is a consequence of globalisation?

• Decreased competition

• Wider range of products available

• Increased government control

• Higher prices for consumers

What role do multinational companies (MNCs) play in globalisation?

• They gain access to cheap labor and raw materials

• They limit communication between countries

• They increase transport costs

• They reduce competition in local markets

What defines free trade?

• Imposition of special taxes on imports

• No restrictions on products bought from abroad

• Government control over all trade

• High tariffs on foreign goods

What is a tariff?

• A subsidy for domestic industries

• A limit on the quantity of imports

• A tax imposed on imported products

• A ban on trade with another country

What is an embargo?

• A requirement for quality standards

• A tax on imported goods

• A ban on trade with another country

• A limit on the number of imports

What is the purpose of exchange control?

• To encourage foreign investment

• To promote free trade

• To restrict the availability of foreign currency

• To lower import tariffs

Why might a government protect infant industries?

• To reduce employment

• To increase imports

• To allow them to grow and become competitive

• To encourage competition

What is dumping?

• Providing subsidies to domestic firms

• Limiting the quantity of imports

• Imposing high tariffs on imports

• Selling products at a loss to gain market share