ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -It creates equality throughout society. Trade ensures efficient allocation of resources and enables the low cost of production and lower prices, but it does not help improve equality.

Detailed explanation-2: -The correct option is C Creation of monopoly power Exposure to foreign investment risks is nil or much lower in foreign trade. This is because of which of the following advantages of exporting/importing?

Detailed explanation-3: -Uncompetitive domestic firms. Tariffs are often designed to protect domestic firms which produce at a higher cost than international competitors. With free trade, they will see a fall in demand and could go out of business.

Detailed explanation-4: -Trade allows U.S. consumers to buy a wider variety of goods at lower prices, raising real wages and helping families purchase more with their current incomes. This is especially important for middle-class consumers who spend a larger share of their disposable income on heavily-traded food and clothing items.