Suppose a Country Attempts to Be Self-Sufficient and Doesn't Trade

question 175

Multiple Choice

Suppose a country attempts to be self-sufficient and doesn't trade with any other countries. From an economic perspective, citizens of this nation can be expected to

• A) gain materially from this policy because they can consume more goods over time than if they engaged in trade with foreigners.
• B) produce less total value than they could if they specialized and engaged in trade with other nations.
• C) gain from more rapid growth since home markets are reserved for home producers.
• D) be just as well off without trade since the value of what is sent to other nations in trade just equals the value of what is received in trade.

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Definitions:

Incentive to Change

Factors or motives that encourage individuals or organizations to modify their behavior or decisions.

Equitable Distribution

a principle aiming for a fair allocation of resources, wealth, or income among members of a society.

Efficient

Refers to the optimal use of resources to achieve the desired ends with minimal waste or effort.

Income

The amount of money received by an individual or entity in exchange for labor or through investments over a certain period.