Even If Production Costs Are Higher in a Foreign Country

question 40

Multiple Choice

Even if production costs are higher in a foreign country, a U.S. firm may establish a manufacturing plant in the foreign country now if:

• A) the host government of that country eliminates all quotas.
• B) the host government of that country reduces all quotas.
• C) the host government of that country increases all quotas.
• D) the host government of that country eliminates all tariffs.

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Definitions:

Popliteus

A small muscle located at the back of the knee joint, critical for unlocking the knee from a fully extended position.

Phalanges

The bones in the fingers and toes of the human body, essential for the movement of the digits.

Flexor Hallucis Longus

A muscle in the lower leg that flexes the big toe and plays a key role in maintaining balance while standing and walking.

Tibialis Posterior

A muscle located in the lower leg that helps support the arch of the foot and plays a role in walking and running.