The infant industry argument is thatA) comparative advantage is irrelevant to economic growth.B) developing countries have a comparative advantage in agricultural goods.C) developing countries have a comparative advantage in manufacturing.D) developing countries have a potential comparative advantage in manufacturing.E) developing countries have no chance to compete with industrialized countries.
Question
The infant industry argument is thatA) comparative advantage is irrelevant to economic growth.B) developing countries have a comparative advantage in agricultural goods.C) developing countries have a comparative advantage in manufacturing.D) developing countries have a potential comparative advantage in manufacturing.E) developing countries have no chance to compete with industrialized countries.
Solution
The infant industry argument is that D) developing countries have a potential comparative advantage in manufacturing.
This argument suggests that new industries in developing countries need protection against international competition until they become mature and stable enough to compete on a global scale. During this period of protection, these industries can develop their capabilities, improve efficiency, and gain a comparative advantage in manufacturing.
Similar Questions
Discuss one reason why developing countries have a higher birth rate than developed countries.
Complete the following statement:Infant industries do not benefit from of scale. This means that their cost of is often higher than other countries. This means that they can’t with large industries from other countries. to domestic producers can help reduce the price of their goods.Submit
Which of the following statements regarding globalisation and jobs is NOT true?Question 10Select one:a.In developing economies, there have been job gains in lower value-added industriesb.In developing economies, there have been job gains in higher value-added industries requiring higher skill and educational levelsc.There have been increasing wages in higher value-added industriesd.There has been job creation in industries where a comparative advantage exists, leading to greater efficiency in the use of factors of production
According to Ricardo, a country will have a comparative advantage in the product in which itsA) labor productivity is relatively low.B) labor productivity is relatively high.C) labor mobility is relatively low.D) labor mobility is relatively high.E) labor is outsourced to neighboring countries.
Which one of the following is a non-economic argument in favour of trade protection?Multiple choice question.Trade barriers can be used to ensure adequate environmental and safety standards in the production of goods and services.Trade barriers can help protect a country's cultural sovereignty.Trade barriers can be used to protect infant industries so that the can grow sufficiently to compete globally.Trade barriers help stimulate domestic employment
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.