CA Foundation · Business Economics · International Trade
Which of the following is an export promotion measure, rather than an import restriction, used as part of trade policy?
Granting an export subsidy is the export promotion measure. It reduces the costs of domestic producers or raises their returns so they can compete abroad. Quotas, anti-dumping duties and minimum import prices instead restrict imports and protect the home market.
- AImposing an import quota on electronic goods
- BLevying anti-dumping duty on imported steel
- CGranting an export subsidy to domestic manufacturersCorrect
- DFixing a minimum import price for certain goods
Explanation
An export subsidy lowers the cost of domestic producers and helps them sell abroad, so it promotes exports. Quotas, anti-dumping duties and minimum import prices all restrict or raise the cost of imports, so they are import-restricting measures.
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