What is meant by the term "government-imposed barrier to entry"? Why would a government be willing to impose barriers to entering an industry?
What will be an ideal response?
Government-imposed barriers to entry are government-issued restrictions which keep new firms from entering an industry. One reason governments are willing to erect barriers to entering an industry is that these barriers may improve the standard of living in the long run; for example, granting patents encourages the development of new products and technologies. Another reason is that firms do favors for politicians who enact such provisions (for example, contributing to campaigns).
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The object of diversification is
A) to reduce risk and fluctuations in income. B) to reduce risk, but not to reduce fluctuations in income. C) to reduce fluctuations in income, but not to reduce risk. D) neither to reduce risk, nor to reduce fluctuations in income.
The NAIRU is a key indicator of how
A. much the economy can slow down without a recession. B. much structural unemployment the economy can sustain. C. unemployment trends occur. D. much faster the economy can grow without pushing up inflation.