Scenario - the Audrey Firm

question 60

Multiple Choice

Scenario - The Audrey Firm
The Audrey Firm is an international trade consulting firm currently providing its services in eight foreign nations.The primary goal of this company is to prevent trade missteps from taking place between foreign nations conducting business with each other.The participating nations prefer to seek counsel with this firm before any of their actions result in major international involvement or World Trade Organization intervention.
In the past,the Audrey Firm's team of experts has handled international situations having the potential to create serious unrest between neighboring countries.Their guidance and expertise have been successful in keeping trade operating freely in several areas of the globe.The Audrey Firm is receiving an award for their exemplary service later this year in Washington D.C.
-Which one of the following would be the least restrictive way in which India and China could impede sales of Power Trip's products within their borders despite the agreement to allow free operations of the company within their nations' boundaries?

• A) Place a tariff on the products
• B) Establish an ad valorem tariff for the products
• C) Establish a generalized system of preferences (GSP)
• D) Establish a very high specific tariff
• E) Establish stringent custom duties

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Definitions:

Financial Statement

Documents that provide an overview of a company's financial condition, including balance sheet, income statement, and cash flow statement.

Permanent/Temporary

Refers to the classification of accounts or differences; permanent accounts are ongoing and not closed at the end of the accounting period, whereas temporary accounts are closed and reset.

Normal Balance

The side (debit or credit) of an account that is typically increased.

Financial Statement

A documented account of financial transactions and standing for businesses, individuals, or alternative entities.