Which of the Following Is One of the Advantages of Export-Oriented

question 52

Multiple Choice

Which of the following is one of the advantages of export-oriented industrialization?

• A)It overcomes the smallness of the domestic market and allows a developing nation to take advantage of economies of scale
• B)The market for the industrial product exists domestically,as evidenced by imports of the commodity,so that risks are reduced in setting up an industry to replace imports
• C)It is easier for developing nations to protect their domestic market against foreign competition than to force developed nations to lower trade barriers against their manufactured exports
• D)Foreign firms are induced to establish so-called tariff factories to overcome the tariff wall of developing nations

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Definitions:

Financial Leverage

Use of borrowed funds to increase the potential return of an investment.

Basic Earning Power

A financial metric that measures a firm's ability to generate earnings from its operations before the impact of taxes and financing costs.

ACP

Average Collection Period, indicating the average number of days it takes a company to collect payments from its credit sales.

Du Pont Analysis

A framework for analyzing a company's return on equity (ROE) by breaking it down into its constituent components to assess operational efficiency.