How Do High Tariffs and Other Restraints on International Trade

question 103

Multiple Choice

How do high tariffs and other restraints on international trade affect a nation's prosperity?

• A) They increase employment and thereby promote the growth of real GDP.
• B) They prevent the nation from fully realizing the potential gains from specialization, exchange, and competition.
• C) They protect domestic producers and thereby promote economic growth.
• D) Both a and c are correct.

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Definitions:

ProActive

The approach of taking initiative and action in anticipation of future problems, needs, or changes rather than simply reacting to them as they arise.

Lawsuit

A legal case brought to a court by one party against another seeking a judgment or remedy in disputes where legal rights are at issue.

Corporate Social Responsibility

A business model where companies integrate social and environmental concerns in their operations and interaction with stakeholders.

Proactive

Taking initiative and action to anticipate and prevent potential problems or to capitalize on opportunities ahead of time.