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Consider the Following Statement: "With Unemployment at Its Highest Level

Question 68

Multiple Choice

Consider the following statement: "With unemployment at its highest level in years, Canada needs to protect domestic jobs by promoting a "Buy Canadian" policy." This statement is _ because _ .


A) incorrect; it will work against Canada's pattern of absolute advantage
B) correct; it recognizes that such a policy can sustain high levels of domestic employment
C) incorrect; it confuses the real and nominal gains from trade
D) correct; a "Buy Canadian" policy will take advantage of Canada's comparative advantage
E) incorrect; it fails to recognize that imports of foreign goods also help to encourage the export of domestic goods

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