The Main Explanation for Why the Cheap Foreign-Labour Argument Is

question 79

Multiple Choice

The main explanation for why the cheap foreign-labour argument is a poor reason for restricting international trade is that:

• A)workers who get paid less tend to have lower productivity than those who get paid more.
• B)all firms and workers gain when there are no restrictions on international trade.
• C)infant industries, such as steel and automobiles, need to be protected.
• D)specialisation and free trade usually raise the prices of all the traded goods, so that the workers can get paid more.
• E)labour costs tend to be the same worldwide in the long run because of worker mobility.

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Definitions:

FIFO Method

The "first-in, first-out" inventory costing method, where the costs of the earliest goods purchased or produced are the first to be expensed.

Periodic System

An inventory system in which updates to inventory levels are made on a periodic basis rather than continuously.

Rising Prices

An economic situation where the general level of prices for goods and services increases over a period of time.

Costing Method

It is an accounting approach to determine the cost of a product or service, including methods such as standard costing, activity-based costing, and others.