Protectionism (Quick Revision)

Question 1

Define: Protectionism

Answer 1

Protectionism are methods of helping domestic firms compete against international businesses.

Question 2

State two examples of protectionism.

Answer 2

• Quotas

* Tariffs

Question 3

State four reasons why a government might protect an industry.

Answer 3

• Retaliation
• To help it become more competitive
• To prevent unemployment
• To protect it against unfair competition

Question 4

State two possible disadvantages of protectionism to consumers.

Answer 4

• Pay higher prices for goods

* Less choice

Question 5

State two reasons why a government might subsidise a firm to locate in its region.

Answer 5

• To encourage more firms to invest and provide jobs

* To retaliate against subsidies offered elsewhere

Question 6

What is the Examiner’s note for Protectionism?

Answer 6

The world trend is towards less protectionism. The World Trade Organisation aims to remove protectionism among member countries and was joined recently by China.

Question 7

What is the Evaluation point for Protectionism?

Answer 7

The extent of government protectionism depends on the need to help certain industries, the government’s attitude to intervention and the protectionism of other governments.