Q13:
Editorial in Krenlandian Newspaper:
Krenland’s steelmakers are losing domestic sales because of lower-priced imports, in many cases because foreign governments subsidize their steel industries in ways that are banned by international treaties. But whatever the cause, the cost is ultimately going to be jobs in Krenland’s steel industry. Therefore, it would protect not only steel companies but also industrial employment in Krenland if our government took measures to reduce cheap steel imports.
Which of the following, if true, most seriously weakens the editorial’s argument?
- Because steel from Krenland is rarely competitive in international markets, only a very small portion of Krenlandian steelmakers’ revenue comes from exports.
- The international treaties that some governments are violating by giving subsidies to steelmakers do not specify any penalties for such violations.
- For many Krenlandian manufacturers who face severe international competition in both domestic and export markets, steel constitutes a significant part of their raw material costs.
- Because of advances in order-taking, shipping, and inventory systems, the cost of shipping steel from foreign producers to Krenland has fallen considerably in recent years.
- Wages paid to workers in the steel industry in Krenland differ significantly from wages paid to workers in many of the countries that export steel to Krenland.
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