Your Roommate Hansen Argues That American Producers Cannot Compete with Foreign

question 64

Multiple Choice

Your roommate Hansen argues that American producers cannot compete with foreign producers because wages are lower in foreign countries than in the United States.Hansen

• A)is incorrect.Free trade raises living standards by increasing economic efficiency.
• B)is right in asserting the need to protect high wages if the United States wishes to maintain its high standard of living.
• C)is correct in arguing that the high wages of U.S.workers make it impossible to compete with workers in low-wage countries.
• D)is advancing the anti-dumping argument for protectionism.

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Definitions:

Exercising Market Power

The action taken by a firm or entity to utilize its market power to influence market conditions, such as price and production levels.

Monopolists

Entities or firms that have exclusive control over the market for a particular good or service, thereby eliminating competition.

Consumers

Individuals or organizations that use economic goods and services for their own personal benefit or to meet their needs.