Which of the Following Is a Disadvantage of Local Requirement

question 12

Multiple Choice

Which of the following is a disadvantage of local requirement laws to foreign companies?

• A) They do not foster local business activity and increase regional and national unemployment.
• B) They make it necessary for the government to resort to expropriation and confiscation.
• C) The companies are forced to bring in raw material and workers from their own countries.
• D) Companies required to hire local personnel might be forced to take on inadequately trained workers.

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Definitions:

Revealed Preferred

Another term for revealed preference, emphasizing the process of deducing preferences by observing actual choices under constraints.

Violates WARP

Deviating from the Weak Axiom of Revealed Preference, indicating inconsistencies in consumer choice under the assumption of rational behavior.

Bundle

A combination of goods or services sold together as a single package, often for a price lower than the sum of their individual costs.

Initial Endowment

An economic term for the total amount of resources an individual, entity, or economy has available at the start.