protectionism

Question 1

protectionism

Answer 1

how the government tries to protect domestic industries and encourage people to buy from home businesses

Question 2

tariff

Answer 2

a tax on imports to make them more expensive

Question 3

why does the government set tariffs

Answer 3

raise revenue
protect jobs
protect infant industries
prevent dumping
prevent entry of undesirable or harmful goods
improve balance of payments

Question 4

how are tariffs affected by PED

Answer 4

depends on elasticity of product e.g petrol vs trainers

Question 5

quota

Answer 5

a physical limit on the quantity of imports allowed into a country

Question 6

embaro

Answer 6

a complete ban on international trade (usually for political reasons)

Question 7

problems with trade barriers

Answer 7

retaliation (what a country could do back in retaliation of a quota or tariff, could affect trade)
elasticity (less affected by quotas however prices will increase with limited supply)

Question 8

government legislation

Answer 8

rules and regulations that make it difficult for importers to penetrate an overseas market

Question 9

subsidies

Answer 9

financial support given to domestic producer to help compete with overseas firm

Question 10

adv of subsidies

Answer 10

increase PM for domestic producers
doesn’t need to be repaid
benefits domestic economy

Question 11

disadv. of subsidies

Answer 11

high cost for government
competitiveness between domestic firms
only short term fix