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Which Policy Reflects the Notion That If Society Enjoys Gains

question 56

Multiple Choice

Which policy reflects the notion that if society enjoys gains due to increased efficiency stemming from trade liberalization,some sort of compensation should be provided to those who are temporarily hurt by import competition?


Definitions:

Allocative Efficiency

A state of resource distribution where it is impossible to make one individual better off without making someone else worse off.

Economic Profit

The difference between total revenues and total economic costs, including both explicit and implicit costs.

Industry

A sector of the economy composed of businesses and organizations involved in the production of goods or provision of services.

Demand Curves

A graphical representation showing the quantity of a good or service demanded at different price levels.

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