The infant industry argument for trade protectionism holds that
A) new industries sometimes need a protective environment in which to grow so that they can compete with older,more established foreign competitors.
B) foreign competitors are often viewed as "infants" by large U.S.firms.
C) tariffs are often preferred to quotas.
D) quotas raise prices more than tariffs raise prices.
E) a and c

Question

Quizplus · Accepted Answer

The infant industry argument suggests that new industries require protection from foreign competition in order to grow and eventually be able to compete with established foreign competitors. Tariffs and quotas may be used as protective measures, but in this case, the argument is specifically for trade protectionism to help infant industries.

The Infant Industry Argument for Trade Protectionism Holds That