When a Firms "Dumps" Some of Its Output in Another

question 12

Multiple Choice

When a firms "dumps" some of its output in another country,it

• A)creates an environmental hazard in the receiving country.
• B)sells its output abroad at a price lower than it costs to produce the output.
• C)increases the total level of employment in the importing country.
• D)is specializing according to comparative advantage.
• E)creates for itself an absolute advantage.

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Definitions:

Payment Date

The specific date on which dividends are actually paid out to shareholders or when a debt obligation must be repaid.

Controlling Influence

The power to govern the financial and operating policies of another entity through ownership, contract, or otherwise, often resulting in a parent-subsidiary relationship.

Parent

A company that controls other companies (subsidiaries) through ownership of more than half their voting stock or by having a significant influence over them.

Equity Method Investments

An accounting technique used to record investments in which the investor has significant influence over the investee but does not control it outright, typically through the ownership of 20% to 50% of the voting stock.