Economists and Others Use Economic Theory

question 1

Multiple Choice

Economists and others use economic theory

• A)only to analyze situations in which money changes hands.
• B)as a partial basis for public policy recommendations.
• C)to confuse their enemies.
• D)to replace value judgments about important policy issues.

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Definitions:

Trade Problem

Issues or challenges that arise in the process of exchange of goods, services, or both between countries.

High Protective Tariffs

Elevated taxes imposed on imported goods to protect domestic industries from foreign competition.

Frederic Bastiat

A French economist and writer known for his theories on free markets and the unseen economic consequences of government intervention.

Free Trade

An economic policy that allows imports and exports between countries with minimal or no tariffs, quotas, subsidies, or prohibitions to encourage international trade.