The Basic Concept Behind Strategic Trade Policy Is That Free

question 156

Multiple Choice

The basic concept behind strategic trade policy is that free trade is the best policy to pursue, but some countries don't play by those rules.Therefore,

• A)it makes no sense to engage in trade at all, and it makes sense to be self-sufficient.
• B)it makes sense to restrict imports of items that are of military significance in order to maintain a strong defense posture.
• C)it makes sense to threaten to protect markets unless other nations agree to open theirs.
• D)it makes no sense to export items of strategic importance to other nations, because they should make them on their own.

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Definitions:

Short-Run Supply Curve

A graphical representation that shows the quantity of goods a firm is willing and able to produce and sell at different price levels over a short period, not allowing for all factors of production to vary.

MC Curve

The Marginal Cost curve, which shows the increase in total cost that arises from producing one more unit of a good or service.

Short-Run Supply Schedule

A graphical or tabular representation of the quantity of goods a firm is willing and able to supply at different price points, over a short period.

Total Profit

The net amount of money a business retains after subtracting all its expenses, taxes, and costs from its total revenue.