The Customs Authority in Zedania Strictly Monitors and Inspects Its

question 55

Multiple Choice

The customs authority in Zedania strictly monitors and inspects its imports. It ensures that certain imported goods follow certain standards and come with appropriate labeling and safety requirements. This is especially necessary for products that are perceived as dangerous. Zedania is not a proponent of free trade. Given this information, it can be said that one of Zedania's reasons for establishing strict safety standards of imported goods is to:

• A) create more demand for the imported goods in the country.
• B) limit the inflow of foreign goods.
• C) create a positive image for its trade partners.
• D) dissuade people from buying domestically-produced goods.

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Definitions:

Inventories

The stock of goods or materials that a company holds for the ultimate goal of resale or production.

Investment

The purchase of new plants, new equipment, new buildings, and new residences, plus net additions to inventories.

Nominal GDP

The total market value of all goods and services produced in a country in a given period, measured using current prices without adjusting for inflation.

Current-Year Prices

Prices of goods and services measured during the same year they are produced, not adjusted for inflation; also referred to as "nominal prices."