Requiring a Firm with International Operations to Follow the Standards

question 27

Multiple Choice

Requiring a firm with international operations to follow the standards of its home country instead of those of the foreign country has all of the following advantages except

• A)it takes care of the fear of a race-to-the-bottom by making it impossible for a home-based company to exploit low standards.
• B)it shifts the costs of improved standards to firms and consumers in high-income countries.
• C)it removes the threat of domestic firms relocating abroad for low standards and ensures that any relocation that takes place is due to foreign comparative advantage.
• D)it avoids the problems of high-income countries dictating what standards are to be used.In this situation,firms that cross national boundaries must conform to whichever standards are higher.
• E)it is a comprehensive measure,since it addresses the problem of production in foreign firms as well as firms from high-standards countries that relocate abroad.

---

Definitions:

European Americans

Individuals residing in the United States who are of European descent, making up a significant portion of the country’s demographic composition.

Lay Referral Network

A system through which individuals seek advice, information, and treatment for health problems from non-professional sources within their community.

Health Care

Organized services and structures aimed at maintaining or improving health through the prevention, diagnosis, treatment, and rehabilitation of illness and disease.

Illness Behavior

The ways in which individuals experience, perceive, and respond to their health problems, including seeking treatment and how they communicate their symptoms.