Assume That a Gucci Handbag Sells for $60 in Italy

question 157

Multiple Choice

Assume that a Gucci handbag sells for $60 in Italy and $240 in the United States because Gucci must add the cost of transportation, tariffs, importer margin, wholesaler margin, and retailer margin to its factory price. This information indicates that Gucci faces a ________ problem.

• A) dumping
• B) tariff
• C) licensing
• D) product adaptation
• E) price escalation

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Definitions:

Stewardship

The responsible management and care of resources or property on behalf of others.

Sustainability

The capacity to maintain or support an activity or process over the long term, often with a focus on environmental, economic, and social considerations.

Ethical Dilemma

A situation in which a decision must be made between two or more morally acceptable or unacceptable alternatives.

Ethical Behaviour

Conduct that is in line with accepted moral norms and values, often characterized by honesty, fairness, and integrity.