PrepTest 80, Section 3, Question 14
Principle: A government should reduce taxes on imports if doing so would financially benefit many consumers in its domestic economy. There is a notable exception, however: it should never reduce import taxes if one or more of its domestic industries would be significantly harmed by the added competition.
Principle: A government should reduce taxes on imports if doing so would financially benefit many consumers in its domestic economy. There is a notable exception, however: it should never reduce import taxes if one or more of its domestic industries would be significantly harmed by the added competition.
Conclusion: The government should not reduce taxes on textile imports.
Principle: A government should reduce taxes on imports if doing so would financially benefit many consumers in its domestic economy. There is a notable exception, however: it should never reduce import taxes if one or more of its domestic industries would be significantly harmed by the added competition.
Conclusion: The government should not reduce taxes on textile imports.
Principle: A government should reduce taxes on imports if doing so would financially benefit many consumers in its domestic economy. There is a notable exception, however: it should never reduce import taxes if one or more of its domestic industries would be significantly harmed by the added competition.
Which one of the following is a statement from which the conclusion can be properly drawn using the principle?
Reducing taxes on textile imports would not financially benefit many consumers in the domestic economy.
Reducing taxes on textile imports would financially benefit some consumers in the domestic economy but would not benefit the domestic textile industry.
The domestic textile industry faces significant competition in many of its export markets.
The domestic textile industry and consumers in the domestic economy would benefit less from reductions in taxes on textile imports than they would from other measures.
The added competition produced by any reduction of taxes on imports would significantly harm the domestic textile industry.
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