A Country with a Relatively Low Level of Real GDP

question 100

Multiple Choice

A country with a relatively low level of real GDP per person is considering adopting two policies to promote economic growth.The first is to decrease barriers to trade.The second is to restrict foreign portfolio investment.Which of these policies do most economists say promote growth?

• A)both the first and the second
• B)the first but not the second
• C)the second but not the first
• D)neither the first nor the second

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Definitions:

Import Substitution

A strategy aimed at reducing foreign dependency through the domestic production of previously imported goods.

Infant Industries

Newly established industries that may not yet be competitive in the global market without protection or support from the government.

Global Rivals

Competitors that operate in multiple countries around the world, often vying for market share in the same industry sectors.

Infant Industry

A newly established sector or industry in its early development stage, often protected by the government through tariffs or subsidies to help it grow.