The Main Problem with Using the Infant Industries Argument to Justify

question 70

Multiple Choice

The main problem with using the infant industries argument to justify protecting an industry from foreign competition is that

• A) all industries will claim that they are infant industries in order to gain protection.
• B) the protected industry will become too efficient and drive out foreign competition.
• C) once in place, it is difficult to remove protection even as the industry matures.
• D) it causes the goods that are produced in the protected industry to have lower prices.

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Definitions:

Business Ownership

The legal possession or control of a business, which may come in various forms like sole proprietorship, partnership, or corporation.

Entrepreneur

An individual who organizes and operates a business or businesses, taking on greater than normal financial risks in order to do so.

Work Fewer Hours

A reduction in the standard working hours for employees, aiming at improving work-life balance.

Entrepreneurs

Individuals who initiate, manage, and assume the risks of launching new businesses or ventures.