The people who support restricted international trade say that ______
A. protection saves jobs, in both the U.S. and foreign economies
B. U.S. firms won't be able to compete with low-wage foreign labor if trade is free
C. outsourcing sends jobs abroad, which brings diversification and makes our economy more stable
D. protection is needed to enable U.S. firms to produce the things at which they have a comparative advantage
B This commonly encountered argument is flawed, because U.S. firms can compete when U.S. productivity is high.
You might also like to view...
Which of these is not among the principal determinants of economic growth?
A) institutions B) education C) research and development D) balanced trade E) saving and investment
In the game in Scenario 13.6, what is the Nash equilibrium?
A) The strategy pair associated with -$100, -$1. B) The strategy pair associated with $2, -$0.5. C) The strategy pair associated with $1, -$1. D) The strategy pair associated with -$0.5, -$0.5. E) There is no Nash equilibrium in pure strategies.