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CA Foundation · Business Economics · International Trade

Dumping, as an issue in free trade versus protection debates, refers to:

Dumping means exporting goods at a price lower than the price charged in the exporter's home market, or below the cost of production. Importing countries often respond with anti-dumping duties to protect domestic producers from this unfair price competition.

  1. AExporting a good at a price lower than its price in the exporter's home market or below costCorrect
  2. BImporting goods in excess of the quota fixed by the government
  3. CDisposing of waste products in other countries
  4. DRaising export prices to earn higher profits abroad

Explanation

Dumping means selling goods abroad at a price below the home-market price or below cost of production. Countries often respond with anti-dumping duties to protect domestic producers. Exceeding a quota or waste disposal is not what dumping means in trade theory.

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