Free Trade and Protection

Which of the following is an argument in favor of protectionist policies?

• Encouraging international competition

• Protecting infant industries

• Increasing consumer choice

• Reducing government intervention

What is a primary argument against tariffs in international trade?

• They increase government revenue

• They can lead to trade wars

• They promote job creation

• They reduce production costs

How does free trade benefit consumers?

• It increases domestic production

• It raises the prices of imported goods

• It leads to greater choice and lower prices

• It limits competition from foreign firms

A quota is used in international trade to:

• Promote free trade

• Limit the quantity of imports

• Increase the variety of imported goods

• Lower domestic prices

Which of the following is an argument against protectionist policies?

• It can cause inefficiency in domestic industries

• It allows domestic industries to compete with foreign firms

• It increases government revenue through tariffs

• It limits foreign dependence on goods

What is the main goal of protectionism in trade?

• To increase global cooperation

• To protect domestic jobs

• To lower prices of foreign goods

• To promote technological innovation

Free trade is often supported because it:

• Increases barriers to entry for new firms

• Encourages innovation through competition

• Protects national security

• Reduces domestic employment

A tariff is most likely to:

• Increase imports

• Make foreign goods more expensive

• Reduce the prices of domestic goods

• Improve efficiency in domestic industries

Which of the following is a potential disadvantage of free trade?

• It can harm infant industries in developing countries

• It promotes inefficient allocation of resources

• It decreases competition in the market

• It increases the prices of domestic goods

Dumping in international trade refers to:

• The practice of exporting high-quality goods at a high price

• Selling goods in a foreign market below production cost

• The restriction of imports to protect domestic producers

• Increasing tariffs to reduce foreign competition