Which of the following would not be associated with ISI?
A) high tariffs
B) fixed exchange rates
C) floating exchange rates
D) SOEs
E) exchange controls

Question

Quizplus · Accepted Answer

ISI (Import substitution industrialization) is a trade and economic policy that aims to substitute imports with domestically produced goods. Choice C, floating exchange rates, is not typically associated with ISI because it allows the domestic currency to freely fluctuate in value, which can make exports more expensive and imports cheaper, therefore not in line with the goal of substituting imports with domestic production. The other choices, high tariffs, fixed exchange rates, SOEs, and exchange controls, are commonly associated with ISI.

Which of the Following Would Not Be Associated with ISI