Question

According to your text, which of the following will hinder foreign competition?

1) High import tariffs
2) Free trade agreements
3) Low production costs
4) Currency exchange rates

Answer 1

High import tariffs, free trade agreements, low production costs, and currency exchange rates can all have an impact on foreign competition.

Step-by-step explanation:

High import tariffs hinder foreign competition. Tariffs are taxes imposed on imported goods, which raise the price of imported products in the domestic market. This can make domestic products more competitive and protect domestic industries from foreign competition.Free trade agreements, on the other hand, promote foreign competition. These agreements eliminate or reduce barriers to trade, such as tariffs and quotas, allowing for increased imports and more competition from foreign firms.Low production costs can also hinder foreign competition. If a country has lower production costs compared to other countries, its domestic firms may have a competitive advantage in terms of price and quality.Currency exchange rates can also have an impact on foreign competition. When a country's currency depreciates in comparison to other currencies, its exports become cheaper for foreign buyers, giving its domestic firms a competitive advantage.