A Possible Explanation That a Nation Might Offer for the Imposition

question 167

Multiple Choice

A possible explanation that a nation might offer for the imposition of a protectionist policy such as a tariff is to

• A) protect an infant industry from foreign competitors.
• B) encourage specialization in the good in which the nation has a comparative advantage.
• C) slow domestic production.
• D) increase the level of imports.
• E) give consumers more foreign-made options.

---

Definitions:

Efficient

The condition in which resources are allocated in a way that maximizes the net benefit to society or achieves an optimal outcome where no one can be made better off without making someone else worse off.

Beneficiaries

Individuals or groups that receive benefits or advantages from something, especially from a trust, insurance policy, or will.

Socially Optimal

A situation in which resources are allocated in the most efficient way from the society's point of view, maximizing total welfare.

Pollution

The contamination of the natural environment by harmful substances or energies, which can affect air, water, and land negatively and pose risks to human health and ecosystems.