Countries That Restrict Foreign Trade Are Likely to

question 25

Multiple Choice

Countries that restrict foreign trade are likely to

• A)forgo the additional surplus that trade allows,but will probably enjoy economies of scale.
• B)forgo the additional surplus that trade allows,but will be compensated by a higher rate of technological change.
• C)forgo the additional surplus that trade allows,but will have a lower rate of unemployment.
• D)have more firms with domestic market power.

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Definitions:

Fixed Expenses

Costs that do not change in total regardless of changes in the level of activity or volume, such as rent and insurance premiums.

Net Operating Income

A profitability metric that calculates a company's potential income by subtracting operating expenses from revenue, excluding taxes and interest.

Sugar Beets

A root vegetable that is primarily cultivated for sugar production.

Industrial Fiber

Manufactured or natural fibers used extensively in industrial applications due to their physical properties like strength, durability, and flexibility.