Understanding Business Protectionism Policies

What is the primary purpose of protectionist policies like tariffs?

• To increase the quality of imported goods

• To protect domestic industries from foreign competition

• To encourage foreign investment

• To reduce government spending

How do tariffs affect the price of imported goods?

• They decrease the price

• They have no effect on the price

• They increase the price

• They make the price fluctuate

Which of the following is a potential drawback of imposing tariffs?

• Increased demand for imported goods

• Decreased government revenue

• Higher prices for consumers

• Improved international relations

What is an import quota?

• A tax on imported goods

• A limit on the quantity of a good that can be imported

• A subsidy for domestic producers

• A ban on all imports

Which of the following is a benefit of import quotas?

• They increase the variety of goods available

• They protect domestic jobs

• They lower the cost of imports

• They encourage foreign competition

What is a potential drawback of import quotas?

• They can lead to trade wars

• They increase the quality of domestic goods

• They reduce government control over trade

• They decrease domestic production

Which of the following is an example of a trade barrier other than tariffs and quotas?

• Import subsidies

• Government legislation

• Export taxes

• Free trade agreements

How can domestic subsidies act as a form of protectionism?

• By reducing the cost of foreign goods

• By increasing the competitiveness of domestic goods

• By encouraging imports

• By lowering domestic production costs

What is a potential benefit of government legislation as a trade barrier?

• It simplifies international trade

• It ensures the safety and quality of imported goods

• It reduces the cost of domestic goods

• It increases foreign investment

Which of the following is a common criticism of protectionist policies?

• They lead to increased innovation

• They promote global economic growth

• They can lead to inefficiencies in domestic industries

• They reduce the variety of goods available to consumers