When a Foreign Firm Sells Its Exports at a Lower

question 144

Multiple Choice

When a foreign firm sells its exports at a lower price than its cost of production, the firm is

• A) imposing an economies of scale cost.
• B) dumping.
• C) avoiding a tariff.
• D) competing in an infant industry.

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Definitions:

Best Response

In game theory, the strategy that yields the highest payoff for a player, given the strategies chosen by other players.

Simultaneous Game

A strategic game in which all players make their moves at the same time, without knowledge of the other players' actions.

Nash Equilibrium

A concept within game theory where no participant can gain by a unilateral change of strategy if the strategies of the others remain unchanged.

Simultaneous Game

A type of strategic game in game theory where all players make decisions or choose their strategies at the same time without knowledge of the others' choices.