Free Trade And Protectionism Flashcards
1
Q
What si free trade
A
Free trade refers to trade without any protectionism measures
2
Q
What are some benefits of free trade
A
Greater efficiency and allocation of world resources -> comparative advantage
- lower prices and more choices for consumers
- can access domestically not produced goods e.g bananas in uk
- economic growth
3
Q
Draw a free trade diagram
A
4
Q
What are the main arguments for protectionism
A
- protect a infant industry -> allow them to grow and achieve eos so they can compete
- prevent dumping
- protect employment
- retaliation
- increase tax revenues
- help correct a current account deficit
- avoid overspecialisation
