A Policy That Attempts to Stimulate Development of Local Industry

question 90

Multiple Choice

A policy that attempts to stimulate development of local industry by discouraging imports through tariffs and nontariff barriers is called ________.

• A) export substitution
• B) import substitution.
• C) development stimulation
• D) protectionism

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Definitions:

Revenue

The total amount of money generated by the sale of goods or services related to a company's primary operations.

Variable Costs

Expenses that fluctuate with the level of output or activity, in contrast to fixed costs which remain constant.

Fixed Costs

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance.

Profit

The financial gain made in a transaction or business operation, calculated as the excess of revenue over expenses.