US Automakers Have an Interest to Make It More Difficult

question 38

Multiple Choice

U.S. automakers have an interest to make it more difficult for European competitors to locate assembly plants in Canada or Mexico and thereby ship finished automobiles to the United States duty-free. This is an example of

• A) trade deflection.
• B) trade diversion.
• C) quotas.
• D) rules of origin.

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Definitions:

Deficit Spending

The practice of spending more money than is received in revenue, typically referring to government spending that exceeds its receipts.

Opportunity Cost

The expense incurred by not selecting the second best choice while making a decision or opting among alternatives.

Debt Default

The failure to meet the legal obligations of a loan, such as not making scheduled payments on time.

U.S. Federal Budget

The government's estimate of revenue and spending for a fiscal year that is proposed by the President and approved by Congress.