Economic growth is an advantage of trade primarily because it leads to which of the following?

Prepare for the UAE First Gulf Exchange Exam with our comprehensive quiz. Study using multiple choice questions, each with hints and explanations. Get ready to excel in your exam!

Economic growth is closely tied to improved job markets, as trade can lead to an expansion of economies in various ways. When countries engage in trade, they often experience increased demand for goods and services, which in turn can drive business expansion. This expansion requires a larger workforce to produce the higher volumes of products or provide increased services, ultimately resulting in more job opportunities.

Additionally, trade can enhance economic performance through comparative advantage, where countries specialize in producing goods they can create most efficiently, leading to more effective resource allocation within economies. As businesses thrive and expand due to trade, they tend to hire more employees, contributing to a reduction in unemployment rates and fostering overall economic stability.

While the other options present relevant concepts in the context of trade and economics, they do not directly lead to economic growth in the same straightforward manner. Increased environmental regulation may occur due to heightened trade, but it does not inherently drive economic growth. Protection of local businesses might result from restricting trade to protect industries, which could inhibit economic growth rather than promote it. Global market dependency can also emerge, but it may have mixed effects on economic stability and growth, potentially leading to vulnerabilities rather than enhanced job opportunities.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy