Which of the Following Statements Is True

question 116

Multiple Choice

Which of the following statements is true?

• A) A subsidy to an infant industry is a more efficient way to protect it from foreign competition than a tariff on the competing foreign goods.
• B) The infant- industry argument is valid only if the benefits of learning- by- doing in the infant industry spill over to other parts of the economy.
• C) Both statements are true.
• D) Neither of the statements is true.

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Definitions:

Specialist

An official in a stock exchange. The specialist is assigned the stocks of specific companies and is responsible for conducting an orderly market in those securities.

Primary Market

The market where new securities are issued and sold for the first time, directly from the issuer to investors.

First-Time Issues

Refers to the initial offering of securities or stocks to the public by a company.

Securities

Financial instruments representing ownership (stocks), creditor relationships (bonds), or rights to ownership (options).