Question

The president of the American Auto Parts Corporation recently testified before members of Congress, urging them to limit the flow of imported automobile parts into the United States. She contended that these imports were priced lower than the foreign producers were charging for the same parts in their own countries. She believes these foreign producers are guilty of _______.

Answer 1

Answer:

The correct answer is:  Dumping.

Explanation:

Dumping refers to exporting a good at a lower price than the price charged for the goods at home. Involves substantial volumes of the exported product and endangers manufacturers and producers in the importing nation. The World Trade Organization states that dumping is unfair competition but most countries condemn it. Dumping is legal under the World Trade Organization rules unless the country can prove it has negative effects.