How can language act as a natural barrier to trade?
AParties may fail to negotiate or may ship the wrong goods
BParties may be forced to trade only in a single currency
CParties may have to pay a higher tariff on their shipments
DParties may be barred by law from signing any contract
Answer & Solution
Correct answer: A. Parties may fail to negotiate or may ship the wrong goods
1. Language is named as a natural trade barrier alongside distance.
2. People who cannot communicate effectively may fail to negotiate trade agreements.
3. They may also ship the wrong goods because the order was misunderstood.
4. Tariffs are government-made barriers rather than natural ones.
5. No law bars parties who speak different languages from contracting.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 3 "Competing in the Global Marketplace", section 3.3 Barriers to Trade_
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