In Theory, Some People Might Lose in the Short Run

question 107

Multiple Choice

In theory, some people might lose in the short run from outsourcing, but in the long run, all should benefit. Which option demonstrates that this theory might not be true?

• A) Lower labor costs lead to lower prices, so more foreigners can buy imports.
• B) Income earned at outsourced jobs allows foreign workers to purchase imports.
• C) Lower prices allow more consumers to buy the good domestically.
• D) Outsourcing stimulates competition.
• E) Inadequate transition programs hinder the ability of domestic workers, who lost their jobs to outsourcing, to obtain new jobs.