Customs Union Theory Reasons That the Formation of a Customs

question 125

Multiple Choice

Customs union theory reasons that the formation of a customs union will decrease members' real welfare when the

• A) trade diversion effect exceeds the trade creation effect.
• B) trade production effect exceeds the trade consumption effect.
• C) trade consumption effect exceeds the trade production effect.
• D) trade creation effect exceeds the trade diversion effect.

---

Definitions:

Taste Buds

Sensory organs located on the tongue that are primarily responsible for detecting the five established taste sensations: sweet, sour, salty, bitter, and umami.

Loss of Smell

The inability or decreased ability to perceive odors, also known as anosmia.

Sixties

Referring to the decade from 1960 to 1969, noted for significant cultural, political, and social change worldwide.

Presbyopia

A condition associated with aging where the eye loses its ability to focus on close objects, commonly occurring after age 40.