When a multinational firm decides to sell its products abroad, one of the risks the firm faces is that the government of the foreign market charges the firm with dumping. Dumping occurs when
A. The same product sells at different prices in different countries.
B. A firm charges less than the cost to make the product so as to enter or win a market.
C. Lower quality versions of the product are sold abroad so as to be affordable.
D. Transfer prices are set artificially high so as to minimize tax payments.
Answer:B
When a multinational firm decides to sell its products abroad, one of the risks the firm faces is that the government of the foreign market charges the firm with dumping. Dumping occurs when
A. The same product sells at different prices in different countries. B. A firm charges less than the cost to make the product so as to enter or win a market. C. Lower quality versions of the product are sold abroad so as to be affordable. D. Transfer prices are set artificially high so as to minimize tax payments.