CA Foundation · Business Economics · International Trade
Which of the following is an example of an export promotion measure used by a government?
Granting subsidies or tax incentives to exporters is an export promotion measure because it lowers their costs and improves competitiveness abroad. Import quotas, higher tariffs and import licensing restrict imports, so they are protectionist tools, not direct support for exports.
- AGranting subsidies or tax incentives to exportersCorrect
- BImposing an import quota on steel
- CRaising the import tariff on electronics
- DRequiring import licences for gold
Explanation
Export promotion uses subsidies, tax incentives and similar support to make exports more competitive. Import quotas, higher tariffs and import licences are all restrictions on imports, so they are protectionist measures rather than export promotion.
Did you get it right without looking?
One question tells you little. A timed set on International Trade shows your real accuracy, how long you take and where you lose marks.
More International Trade questions
- When a small open economy imposes an import tariff on a good, what is the usual effect on the domestic price and domestic production of that…
- India's export price index rises from 100 to 120 while its import price index rises from 100 to 150 over a period. The net barter terms of t…
- In India, 1 unit of labour produces 10 kg of rice or 20 metres of cloth. In Bangladesh, 1 unit of labour produces 6 kg of rice or 18 metres …
- Adam Smith's theory of absolute advantage says that a country should export a good when:
- Which economist is associated with the theory of absolute advantage, under which a country gains by exporting goods it can produce using few…
- A country has a current account deficit of $30 billion and a net capital account (financial account) inflow of $22 billion, with errors and …