U.S. flashlight manufacturers have found that manufacturers in Brazil are export

Question

U.S. flashlight manufacturers have found that manufacturers in Brazil are exporting their flashlights to the U.S. and selling them at a price that is less than half that charged to domestic retailers by U.S. manufacturers. This competition has resulted in substantial reduction in the number of U.S. manufactured being sold. The U.S. manufacturers believe that the Brazilian manufacturers are selling the products at a price below what the flashlights actually sell for in Brazil, and the sales price might even be below the cost of production.

Which of the following is most correct?

Import laws will not protect the U.S. manufacturers from the lower-priced imports, even if the price in the U.S. is lower than the cost of production or the price at which the goods are sold in Brazil.

The U.S. manufacturers can rely on U.S. import laws that are required to impose duties on the imports if the price of those imports is below the price at which the products are sold in the home country of Brazil.

The U.S. manufacturers can rely on U.S. import laws that are required to impose duties on the imports if the price of those imports is less than the cost of production.

The U.S. manufacturers can rely on U.S. import laws that are required to impose duties on the imports if the price of those imports is either below the price at which the products are sold in the home country of Brazil, or if the price is less than the cost of production.

Import laws will not protect the U.S. manufacturers from the lower-priced imports, even if the price in the U.S. is lower than the cost of production or the price at which the goods are sold in Brazil.

The U.S. manufacturers can rely on U.S. import laws that are required to impose duties on the imports if the price of those imports is below the price at which the products are sold in the home country of Brazil.

The U.S. manufacturers can rely on U.S. import laws that are required to impose duties on the imports if the price of those imports is less than the cost of production.

The U.S. manufacturers can rely on U.S. import laws that are required to impose duties on the imports if the price of those imports is either below the price at which the products are sold in the home country of Brazil, or if the price is less than the cost of production.

Explanation / Answer

Option D is the right Answer.

This practice of exporting below the domestic selling price or below the actual cost of production is called dumping and is done in order to capture the market.

In order to protect against such unhealthy trade practices, the US import laws impose duties in order to protect the interests of the US Manufacturers

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