The relationship between import substitution policies and export-led development policies is best characterized by which of the following?
A) Import-substitution policies are more likely to lead to production of mature products, whereas export-led development policies result in production of growth products.
B) The two are hard to distinguish because production under import substitution may eventually be exported.
C) Production under import substitution policies, as opposed to export-led development policies, is more likely to be located in urban areas.
D) Production under import substitution policies, as opposed to export-led development policies, is likely to be more labor-intensive.
Question 2
It is sometimes contended that by imposing import controls a country might be able to increase its exports. This contention is premised on ________.
A) the country's simultaneous currency depreciation, which decreases the price of its exports
B) using the import taxes to institute efficiency measures in potential export industries
C) raising domestic prices in one industry so that the excess domestic profits in that industry can compensate for the cost of dumping products from another industry into foreign markets
D) getting other countries to maintain or relax their current import restrictions instead of escalating restrictions in a trade war
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