<u>Question 1</u>
The correct answer is: "I and III".
If trade barriers with foreign countries are lowered, domestic industries will start to operate in the international markets in equality of conditions with the foreign competitors, even in the domestic markets. They will lose the exclusivity advantages that they formerly enjoyed with domestic demand and now they have to face a more fierce competition and confront a highest number of competitors.
Moreover, if the industries stop investing in Research and Development, their technologies can become obsolete and they are not producing at the highest efficiency levels (if compared to the existing technological progress), therefore they lose another competititve strength.
<u>Question 2</u>
The correct answer is: "neocolonialism"-
Wallerstein introduced the world-systems theory, that states that division of labor should be introduced in a global scale, with countries that specialize in obtaining raw materials (peripheric countries), others in transforming them and manufacturing products (semi-peripheric countries), other countries in developing technlogies (core countries), etc.
<u>The system proposed ensures a lasting (not forever) dominance of core countries over the other regions functioning as a modern form of economic colonialism or neocolonialism. </u>The value of the goods and services commercialized by the core countries is higher than the value obtained by the others for their exports.
