Exports Behaviour And Policies

Question 1

Dumping

Answer 1

Exports price is too low. Either export price is lower than price charged for compatible domestic sales in home market of exporter of export price is lower than full unit cost.

Question 2

Predatory dumping

Answer 2

Temp low pricing in foreign export market with purpose of driving competitors out of business.

Question 3

Cyclical dumping

Answer 3

During recession times market price falls below LR average cost, but industry will continue to produce as long as MC is covered.

Question 4

Seasonal dumping

Answer 4

Intention to sell off all excess inventories.

Question 5

Persistent dumping

Answer 5

a firm can use its market to price discriminate between markets.

Question 6

Export subsidies

Answer 6

Gov provision of financial assistance to exporters. They do this with low interest loans for exporters, tax relief for exports and cash subsidies.