What Is Parallel Importing

question 7

Multiple Choice

What is parallel importing?

• A) Trade customers buy goods cheaper abroad, import them and undercut the manufacturer
• B) A manufacturer piggybacks on another manufacturer's distribution channel
• C) A manufacturer imports and prices two product lines together
• D) Distributors put together a large shipment of different goods to cut costs
• E) An agreement between two companies to swap shipments of goods without any money changing hands

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Definitions:

Marginal Revenue

The additional revenue that a company earns from selling one more unit of a product.

Monopolistic Competitor

A market structure where many companies sell products that are similar but not identical, allowing for some degree of market power.

Short Run

The length of time it takes all fixed costs to become variable costs.

Long Run

The long run is a period in economics wherein all inputs can be adjusted, and there are no fixed costs, allowing full operational flexibility.