Developing Countries Often Create Free Trade Zones Where

question 4

Multiple Choice

Developing countries often create free trade zones where

• A)duties and tariffs are imposed as long as production is used primarily for export.
• B)duties and tariffs are imposed as long as production is used primarily for import.
• C)duties and tariffs are relaxed as long as production is used primarily for export.
• D)duties and tariffs are relaxed as long as production is used primarily for import.

---

Definitions:

Interest Rate

The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan’s balance.

Acquisition Cost

The total cost incurred to acquire an asset, including the purchase price and additional expenses necessary to bring it to its intended use.

Present Value

The present value of a future amount of money or series of cash flows, considering a certain rate of return.

Annuity Due

An annuity for which payments are made at the beginning of each period.