When Overall Production Is Taken into Account, Trade Restrictions, Such

question 201

Multiple Choice

When overall production is taken into account, trade restrictions, such as those enacted by the Smoot-Hawley trade bill,

• A) save good paying jobs.
• B) neither create nor destroy jobs; they reallocate them.
• C) increase employment in the domestic industries that are most productive.
• D) reduce imports, without affecting the volume of exports.

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Definitions:

Line Segment AB

The part of a line that is bounded by two distinct end points, and contains every point on the line between its endpoints.

Overhead

Overhead refers to the ongoing business expenses not directly tied to creating a product or service but necessary for the business's operations, such as rent, utilities, and salaries.

Law of Diminishing

Refers to the Law of Diminishing Returns, which states that adding more of one factor of production, while holding others constant, will at some point yield lower per-unit returns.

Marginal Returns

The change in output resulting from a one-unit increase in a particular input, while holding other inputs constant.