Question

France gave Excelsior's Limited (a U.S. manufacturer of beauty products) permission to export its product to France as long as the company obtained a special license first. Excelsior has been waiting six months for the license and is wondering if it will ever arrive. Excelsior's Limited is experiencing a(n) ________ which is a common instrument for a government to _______.

Answer 1

Answer:

Administrative delay, restrict trade

Explanation:

An administrative delay refers to a procedural delay which occurs when a foreign product is allowed to be sold in the domestic market. In such a case, a waiting period gets imposed before the expiry of which the foreign exporter cannot enter the domestic market and sell it's products.

This delay is in the form of going through a very time consuming and cumbersome process of availing licenses, permits, sanctions, etc from the government.

Administrative delay acts as a barrier to trade since in a way it discourages the exporters from exporting their products to a foreign market owing to a tedious cumbersome time consuming procedure.

The practice is used by governments to restrict trade.