Which of the following best completes the table? Table listing kinds of trade barriers with examples of each. Regulation, clothing made using child labor. Tariff, foreign steel. Embargo, diamonds from Zimabawe.

What is an example of local content requirement?

Customs duties paid on cloth made in India

Imported apples exceeding a percentage of domestic production

Inexpensive sugar grown in the Caribbean

Oil from a Middle Eastern country that is considered hostile

1. The best that completes the table is:

Oil from a Middle Eastern country that is considered hostile.

2. An example of local content requirement is:

Imported apples exceeding a percentage of domestic production.

Explanation:

Many countries of the world impose free-trade restrictions.  For example, tariffs raise the prices of imported goods relative to domestic goods (good produced at home), thereby making imports more expensive.  Some governments provide subsidies to their domestic industries, thereby making the domestic goods cheaper than their foreign counterpart and discouraging free trade. Local content requirements are another means to restrict free trade.  These requirements demand that part of the production process for imported goods be completed domestically.

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