​Panama Is Considering Instituting Trade Restrictions in Order to Balance

question 150

Multiple Choice

​Panama is considering instituting trade restrictions in order to balance its payments,protect new businesses,and protect domestic jobs.What may be some of the reasons it would not want to institute trade restrictions?

• A) ​Higher prices for consumers,restrictions of consumers' choices,misallocation of international resources,and loss of jobs.
• B) ​Lower prices for consumers,more consumer choices,proper allocation of international resources,and increase in employment.
• C) ​Sluggish market improvements,high retail prices,and lack of international resources.
• D) ​Loss of jobs,lack of national innovation,and high interest rates.

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Definitions:

Cost of Goods Sold

Costs directly connected to the assembly of products sold by a business, covering materials and labor expenses.

Operating Income

The profit realized from a business's core business operations, excluding deductions of interest and tax.

Operating Expenses

Costs associated with running the day-to-day operations of a business which are necessary to keep the business functioning, excluding the cost of goods sold.

Gross Profit

The distinction between the income from sales and the expense of goods sold prior to subtracting costs for overheads, wages, taxes, and interest.