If, in the Long Run, International Trade Improves the Standards

question 78

Multiple Choice

If, in the long run, international trade improves the standards of living in participating countries, why might some countries want to place trade barriers, such as extra taxes, on imported products?

• A) Imported products compete with domestic products and thus put pressure on local business.
• B) Imported products are usually not as good quality as domestically made products.
• C) Generating government revenue is often more economically valuable than free trade.
• D) This is necessary to keep a country's currency strong.
• E) International trade tends to lead to political tension.

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Definitions:

FOB Destination

A shipping term indicating that the seller pays for transportation of the goods to the buyer's location and owns the goods in transit.

Freight Costs

Charges incurred for transporting goods between places, typically included as part of the cost of goods sold or inventory.

FOB Destination

A shipping term meaning the seller retains the risk and ownership of goods until they are delivered to the buyer's location.

Freight Charges

Costs associated with transporting goods from one place to another, often paid by the buyer or seller depending on terms of sale.