Difficulty: Hard

Average Score: 0%

What does the term resource mobility describe?

Rationale

The assumption that a resource removed from one industry can be moved to another.

Resource mobility refers to the capacity of resources, such as labor and capital, to be reallocated from one industry to another, enhancing efficiency and productivity within an economy.

A (An economic condition in which a nation exports more than it imports) YOUR ANSWER

This choice describes a trade surplus, not resource mobility. A trade surplus focuses on the balance of trade and does not address the transferability of resources between different industries within an economy.

B (The assumption that a resource removed from one industry can be moved to another) CORRECT

This accurately captures the essence of resource mobility, which emphasizes the flexibility and adaptability of resources, allowing them to be utilized where they are most productive and needed, thereby contributing to economic efficiency.

C (The idea that market forces should determine how much to trade with little or no government intervention) YOUR ANSWER

While this choice relates to free trade and market dynamics, it does not specifically address the movement of resources between industries. Resource mobility is more about the transfer of resources themselves rather than the policies governing trade.

D (The idea that governments should actively defend domestic industries from imports and vigorously promote the export of resources) YOUR ANSWER

This option outlines a protectionist approach to trade policy, which is contrary to the concept of resource mobility. Resource mobility focuses on the free movement of resources, whereas this choice emphasizes government intervention to protect domestic industries.

Conclusion

Resource mobility is crucial for economic growth as it allows resources to be allocated where they are most effective. The correct understanding is that it involves the flexibility of resources to transition between industries, enhancing overall productivity. Other choices discuss trade balances, market regulations, or protectionist policies, which do not encapsulate the concept of resource mobility.

Related Questions

View all