To Avoid Tariffs, a Japanese Firm Moves Its Final Assembly

question 170

Multiple Choice

To avoid tariffs, a Japanese firm moves its final assembly line to Mexico and then ships the final products to Canada. This is an example of

• A) trade deflection.
• B) trade diversion.
• C) protectionism.
• D) rules of origin.

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Definitions:

Work in Process Inventory

Goods that are in the production process but are not yet completed.

Direct Materials

Materials in their unprocessed or natural state that can be directly linked and assigned to the end product during the production phase.

Work in Process

Inventory that is in the production process and has not yet been completed or turned into final goods.

Labeling Department

A section within a manufacturing process dedicated to attaching labels to products, outlining product information or branding.