Chapter 21

Question 1

is the policy of protecting domestic industries against foreign competition means of tariffs, subsidies import quotas, or other restrictions placed on import competitors

Answer 1

Protectionism

Question 2

Tarriffs

Answer 2

taxes that are levied on imported goods with the aims to either increase prices of imported products to the level of domestic prices or raise revenue for the govt

Question 3

Imported Quotas

Answer 3

limitations on the quantity of products that a country can import

Question 4

Non tariff Barriers

Answer 4

ways a nation can draw up rules, regulations, inspections and paperwork to make it more costly or difficult to import products

Question 5

a demand and supply analysis of protectionism shows

Answer 5

that it is not just a matter of domestic gains and foreign losses, but a policy that imposes substantial domestic costs as well

Question 6

protectionism has been rather a ______ then an _________

Answer 6

norm; expectation

Question 7

many economists agree that the economy generally benefits from?

Answer 7

free trade

Question 8

protectionist policies became known as

Answer 8

mercantilism

Question 9

Great Britain began to abandon its protective tariffs in the 19th century due to their repeal of _____ _____ and other duties on imported goods

Answer 9

Corn Laws

Question 10

-protectionism _______ the price of protected goods in the domestic market, this causes domestic consumers to ____ ______ and domestic producers to _____ _____

Answer 10

raises; pay more; earn more

Question 11

How can imports injure workers

Answer 11

can lead to fewer jobs, lower wages and poorer working conditions

Question 12

Protectionism can save jobs in a specific industry being protected but…

Answer 12

it costs jobs in other unprotected industries

Question 13

If a firm sells a protected product to other firms, so that other firms must now pay a higher price for a key input, then those firms will lose sales to foreign produces-lost sales=…

Answer 13

lost jobs

Question 14

The WTO helps create rules for trade between its

Answer 14

164 members

Question 15

What does the WTO do

Answer 15

-creates opportunities for Canadian workers and businesses through WTO participation
-provide framework

Question 16

Canada was established into the WTO on

Answer 16

January 1st 1995

Question 17

What are 3 things workers in low income countries undergo:

Answer 17

1. labour under conditions that would be illegal in canada

2.are often paid less than canadian minimum wage

3.have working conditions that may be extremely unpleasant or unsafe

Question 18

what is a huge concern on globalization towards low skilled low wage workers

Answer 18

high skilled and high wage worker will be the only one benefiting from it, high skilled workers benefit from increased sales or popular products, low skilled workers must compete against EXTREMELY low wage workers for making simpler products

Question 19

what is a pro and a con of trade

Answer 19

Pro: Trade raises the amount that an economy can produce by letting firms and workers specialize in what the produce most efficiently. Trade will cause the average level of wages in an economy to rise.
Con: Barriers to trade will reduce the average wave levels in an economy

Question 20

lower wage workers suffer due to protectionism in all industries bc…

Answer 20

they pay higher prices for goods

Question 21

The _______________ argument for protectionism is that small domestic industries need to be temporarily nurtured and protected from foreign competition so that they can grow into strong competitors.

Answer 21

Infant Industry

Question 22

a semi connected argument is that domestic industries should be protected from dumping, when foreign companies sell under a fair price and drive domestic firms out of a the market. _____________ is difficult to enforce since it is very difficult to define what a “fair” price is

Answer 22

Anti dumping

Question 23

_________________ is sometimes invoked for a reason of protectionism because low-income countries typically have lower environmental standards than high-income countries; hey are more worried about immediate basics such as food, education, and healthcare.

Answer 23

Environmental Protection

Question 24

the __________________ argument for protectionism holds that it is unwise to import certain key products because if the nation becomes dependent on key imported supplies, it could be vulnerable to a cutoff.

Answer 24

National Interest

Question 25

_________________________________ was a forum in which nations could come together to negotiate reductions in tariffs and other barriers to trade
-was the precursor of the WTO

Answer 25

General Agreement on Tariffs and Trade (GATT)

Question 26

____________________ is an economic agreement between countries to allow free trade between members without tariffs or quotas

Answer 26

Free Trade Agreement

Question 27

______________ is an economic agreement between countries to allow free trade in goods, services, labor and financial capital between members while having a common external trade policy

Answer 27

Common Market

Question 28

____________ is an economic agreement between countries to allow free trade between members, a common external trade policy, and coordinated monetary and fiscal policy

Answer 28

Economic Union

Question 29

CUSMA stands for

Answer 29

Canada, US, Mexico agreement

Question 30

CETA stands for

Answer 30

Canada Comprehensive Economic and Trade Agreement

Question 31

APEC stands for

Answer 31

Asia Pacific Economic Cooperation

Question 32

The European Trade Agreements are known as..

Answer 32

European Union and European Commission

Question 33

refers to the exchange of goods and services between countries

Answer 33

International Trade

Question 34

is when a country can produce a good or service at a lower opportunity cost compared to another country

Answer 34

Comparative Advantage

Question 35

Benefits of Globalization include:

Answer 35

promoting increased trade, foreign investment, technology transfer, and access to a larger consumer base. it leads to greater product variety and lowering consumer prices

Question 36

Drawbacks of Globalization include,how can govt address these issues:

Answer 36

job displacement, potential exploitation of labor in developing countries, and loss of cultural identity. Governments can address these challenges through retraining programs, labor laws, and promoting cultural preservation.

Question 37

Trade barriers such as tariffs (taxes on imports) and quotas (limits on the quantity of imports) can..

Answer 37

hinder international trade, reduce competition, and increase prices for consumers

Question 38

what are income distribution effects of international trade

Answer 38

-all domestic or international competitive market forces are disruptive causing companies and industries to rise and fall
-Government has a role to play in cushioning workers against the disruptions of the market. However, in domestic markets, it would be unwise to clamp down on foreign trade
-disruption brings economic benefits