Chapter 20.3, Problem 3R

To determine

To explain: The reason for an economist can support the idea of forming economic alliances between countries.

Explanation of Solution

Economists support the idea of forming alliances as forming alliances can lead to better economic relations. Alliances means agreement between nations or firms and countries. This is done to enter the markets of one another through joint ventures and to gain more profits.

Many big multinational companies form alliance with small firms to develop some part of their products. This helps both companies grow and prosper in the market. Forming alliance is an indication of understanding the limitations of own and accepting the growth of another. Making alliance is an economic strategy too in industries where rapid changes are seen.

Economics Concept Introduction

Introduction:

Economic alliances- All of the countries are trying to come today on a global platform to make themselves economically strong. In this process, they make multinational direct investments and form alliances with other countries. Economic alliances are agreements between groups or countries to support each other economically.