Which of the Following Is an Example of a Trade

question 91

Multiple Choice

Which of the following is an example of a trade restriction?

• A)Japan places a tax on all Korean automobiles.
• B)Domestic wine is more expensive than wine imported from Chile.
• C)The United States,Canada,and Mexico sign the NAFTA agreement.
• D)Consumers prefer German beer to domestic beer.

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Definitions:

Allocative Efficiency

A state of the economy in which resources are apportioned in a way that maximizes the overall benefit to society.

Productive Efficiency

A situation where an economy or a production entity cannot produce more of one good without sacrificing production of another good and by using the least costly production techniques.

Long-Run Adjustments

The process by which firms adjust their production levels, input mixes, and operations to reflect changes in the market or economic conditions over a longer period.

Allocative Efficiency

A state of the economy in which production represents consumer preferences; in other words, every good or service is produced up to the point where the last unit provides a utility level equal to the cost of producing it.