Asked by Carrisa Green on Jun 17, 2024
Verified
Which of the following is true of import substitution?
A) The government encourages domestic producers to make products which can compete in the international market.
B) The government takes steps to liberate imports and lift restrictions.
C) The government takes steps to promote exports and subsidizes export-oriented production.
D) The government insulates domestic producers by imposing strict tariffs and quotas.
E) The government focuses on service-oriented imports rather than primary imports.
Domestic Producers
Companies or individuals that manufacture or produce goods and services within their home country, as opposed to importing them from abroad.
Tariffs and Quotas
These are trade policies where tariffs are taxes on imported goods, and quotas are limits on the amount of a good that can be imported.
- Analyze the role of government intervention in influencing economic strategies such as export promotion or import substitution.
Verified Answer
JM
jathishan mohanJun 22, 2024
Final Answer :
D
Explanation :
Import substitution is a trade and economic policy that seeks to reduce a country's foreign dependency through the development of domestic industries. It does this by imposing strict tariffs and quotas on imports so that domestic producers can capture a larger share of the domestic market. Therefore, option D is the correct answer.
Learning Objectives
- Analyze the role of government intervention in influencing economic strategies such as export promotion or import substitution.