Explain with an Example the Administrative Trade Policies Used by Governments

question 12

Essay

Explain with an example the administrative trade policies used by governments in addition to the formal instruments of trade policy.

Differentiate between various overhead rate calculations based on capacity measures.

Identify the necessity of using departmental overhead rates when cost drivers vary significantly across departments.

Comprehend common bases for allocating costs of shared resources to responsibility centres.

Understand the concept of a cost pool and its role in cost allocation.

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Definitions:

Cartels

Formal agreements among competing firms to control prices, production, and distribution of goods, often to restrict competition and increase profits illegally.

Collusive Arrangements

Agreements between firms to control prices or exclude entry of a new competitor in the market, often in violation of antitrust laws.

Secret Price Concessions

Unadvertised discounts or reductions in price offered to buyers, often as part of negotiation processes in sales transactions.

OPEC

The Organization of the Petroleum Exporting Countries (OPEC) is an intergovernmental organization of oil-exporting countries aimed at coordinating and unifying petroleum policies to secure fair and stable prices for petroleum producers.