theme 4

Question 1

Protectionsim

Answer 1

gov make policies to protect their domestic industries

Question 2

why do gov create protectionist policies (4)

Answer 2

protect jobs
infant industries
stop dumping
gov gain revenue

Question 3

how does protectionism protect jobs

Answer 3

having manufacturing industries in your country creates jobs however if e.g the uk imports all its manufactured goods from china then uk manufacturing sector declines

Question 4

how does protectionism protect infant industries

Answer 4

new start up industries cant compete internationally with more established firms or MNC’s as they can sell at low prices pushing infant industries out of the market. therefore during this period gov can support them e.g subsidies

Question 5

what is dumping

Answer 5

foreign countries who over produce sell to overseas firms for a lower cost lower in the foreign market.

Question 5

how does protectionism raise revenue

Answer 5

by making quotas , tariffs this creates extra revenue for government which they can invest into other areas. e.g public transport

Question 6

what are the forms of protectionsim

Answer 6

tariffs
quotas
tech barriers to trade
government subsides

Question 7

what is tarrifs

Answer 7

tax placed on imported goods

Question 8

how do tarrifs help protectionism

Answer 8

forgien firms have to pay taarifs and accept lower profit margins or they have to increase their prices of the goods/services to consumer. benefits domestic firms because they can be more price competitive

Question 9

what are quotas

Answer 9

country says how much goods/services is allowed in a country during a specific time period

Question 10

how do quoats help protectionism?

Answer 10

lowers the amount of goods/services domestic firms can bring in

Question 11

what are tech barriers to trade?

Answer 11

laws countries put in place for goods and services being sold in your country. e,g all cars have to be electric

Question 12

how do tech barriers to trade help protectionism?

Answer 12

your market might become unattractive to some firms because it would increase their costs
some firms might adjust their products but their costs will increase

Question 13

what are subsidies and loans

Answer 13

government help

Question 14

how do subsidies and loans help protectionsim?

Answer 14

instead of gov peanlising domestic firms they can give loans to industries e.g infant to buy machinery but also to invest in r&d
this can lead them to be more efficient and compete better.

Question 15

what are the postive impacts of protectionism to domestic firms? (2)

Answer 15

more competitive e.g if gov places tarrifs then other firms see lower profit margins whilst yours increases. Also more price comeptitive

more domestic demande.g if gov places quotas on how much cars can be imported they wont be able to sell as much as you

Question 16

what are the negative impacts to protectionism to domestic firms?

Answer 16

some domestic firms rely on raw materials imported if tarrif is placed on them the cost of buying raw materials increases.

Question 17

how to overseas firms serve protectionist policies?

Answer 17

setting up in domestic countries so they dont have to pay protectionlist policies
BUT
starting up and moving costs can be expensive they need to make sure demand is always good.