All of the following are true of protectionism EXCEPT:
A) industries must be shielded from foreign competition.
B) large trade deficits of the United States must be reduced.
C) maximum gain on a worldwide basis will be realized if capital flows are unrestricted.
D) trade barriers in foreign countries restrict American imports to them.

Question

Quizplus · Accepted Answer

Protectionism advocates for restricting free trade and promoting domestic industries by imposing trade barriers like tariffs and quotas. Option A and D are true statements about protectionism, as it aims to shield domestic industries from foreign competition and restrict imports. Option B is also true as protectionists aim to reduce trade deficits by limiting imports and promoting domestic production. Option C is not true because protectionism promotes restrictions on the flow of capital and investments across borders, which contradicts the idea of unrestricted capital flows for maximum gain on a worldwide basis.

All of the Following Are True of Protectionism EXCEPT