A Recommended Policy for DVCs to Implement That Promotes Economic

question 35

Multiple Choice

A recommended policy for DVCs to implement that promotes economic growth is:

• A) Establishing realistic policies for exchange rates
• B) Obtaining more low-interest loans from the U.S. government
• C) Encouraging more tariffs and quotas to protect DVC businesses
• D) Discouraging direct foreign investment to make DVCs more self-sufficient

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Definitions:

Economic Profits

The difference between total revenues and total costs, including both explicit and implicit costs.

Short-Run Equilibrium

A state in which market supply and demand balance out at current prices, leading to an economic situation where no incentive exists for prices to change.

Allocative Efficiency

A state of resource distribution where it is impossible to make one individual better off without making someone else worse off.

Economic Profit

The difference between total revenues and total economic costs, including both explicit and implicit costs.