Which of the Following Is Not One of the Three

question 24

Multiple Choice

Which of the following is not one of the three main disadvantages of an import-substitution industrialization strategy?

• A)Domestic industries can grow accustomed to protection from foreign competition and have no incentive to become more efficient
• B)Import substitution can lead to inefficient industries because of the smallness of the domestic market in many developing nations
• C)After the simpler manufactured imports are replaced by domestic production,import substitution becomes more and more difficult and costly as more capital-intensive and technological advanced imports have to be replaced by domestic production
• D)Unhappy domestic producers who will not like the tariff barriers in their respective industries.

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Definitions:

Security A

A generic term used to represent a particular stock or financial instrument in theoretical examples.

Beta

A measure of a stock's volatility in relation to the overall market; a beta greater than 1 indicates higher volatility, and less than 1 indicates lower volatility.

Price Takers

Market participants who accept the prevailing prices in the market for their products or services because they have no power to influence those prices.

Holding Period

The amount of time an investment is held by an investor before being sold.