alleryStart learning →What is dumping?
ASelling surplus goods to a government at a fixed price
BShipping goods abroad without declaring them at customs
CBuying a foreign competitor in order to close it down
DCharging a lower price abroad than in the home market
Answer & Solution
Correct answer: D. Charging a lower price abroad than in the home market
1. Dumping is a pricing practice rather than a smuggling or takeover practice.
2. It means charging a lower price for a product in foreign markets than in the home market.
3. The foreign price may even be below cost.
4. Antidumping laws exist so that domestic firms can compete on an equal basis.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 3 "Competing in the Global Marketplace", section 3.4 Fostering Global Trade_
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