Question

Select the statement that shows how Alvaria, a fictional country, practices protectionism.

Alvaria is a small Pacific Rim nation. The country is known for its ancient, colorful culture. To preserve and protect its culture, the Alvarian government decided to make Alvarian history and culture a compulsory subject from grades 5 to 10. Alvarian cuisine is unique, with beef, potatoes, and lamb being the staple foods. Although Alvaria has a flourishing beef industry, it recently opened its beef market to other nations, such as neighboring Coland. Traders pay a 25% tariff on Colandian beef imported into Alvaria. While traders do not pay a tariff for importing Alvarian beef into Coland, they are prohibited from importing more than 15,000 metric tons of beef. Competition with foreign producers has led to improved quality standards for Alvarian beef. While some people prefer to buy domestic beef, many people are happy to try imported beef.

Answer 1

ANSWER: "Traders pay a 25% tariff on Colandian beef imported into Alvaria."

Answer 2

ANSWER: "Traders pay a 25% tariff on Colandian beef imported into Alvaria."

Protectionism, as an economic policy that aims to protect local businesses from foreign competition, implements policies that restrict or limit international trade such as establishing tariffs on imported goods, import quotas and the establishment of product standards.

By Alvaria setting a 25% tariff on the imports of Coladian beef into the nation, is taking a measure to protect the local beef industry from foreign competition.