All are advantages of foreign trade EXCEPT: People get foreign exchange Nations compete Cheaper goods Optimum utilization of country's resources
Question
All are advantages of foreign trade EXCEPT:
- People get foreign exchange
- Nations compete
- Cheaper goods
- Optimum utilization of country's resources
Solution
To identify which option is not an advantage of foreign trade, let's analyze each option provided:
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People get foreign exchange: This is an advantage of foreign trade as it allows countries to earn foreign currency, which can be used for various international transactions.
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Nations compete: Competition is a characteristic of foreign trade. It can lead to improvements in quality and pricing, benefiting consumers. This can be viewed as an advantage.
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Cheaper goods: One of the main benefits of foreign trade is that it often leads to cheaper goods for consumers due to comparative advantages and economies of scale from international producers. This is clearly an advantage.
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Optimum utilization of country's resources: This is a more debated point. While foreign trade can help utilize resources more effectively, it can also lead to over-reliance on foreign markets and exploitation of local resources, potentially leading to disadvantages such as environmental degradation.
Final Answer
The answer is: Optimum utilization of country's resources is not universally accepted as an advantage of foreign trade; it can sometimes lead to negative consequences, unlike the other options listed.
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