A sudden shift from import tariffs to free trade may induce short-term unemployment in ?
Correct answer: A. Import-competing industries
- A. Import-competing industries
- B. Industries that are only exporters
- C. Industries that sell domestically as well as export
- D. industries that neither import nor export
Explanation
Removing tariffs exposes import-competing industries to cheaper foreign goods, so they may reduce output and employment in the short run. Export industries generally gain rather than lose from freer trade.
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