Stringent governmental regulations (e.g., air quality standards) imposed on domestic steel manufacturers tend to
A) increase the competitiveness of domestic steel manufacturers in the international market.
B) reduce the competitiveness of domestic steel manufacturers in the international market.
C) increase the profitability and productivity of domestic steel manufacturers.
D) reduce the market share of foreign firms selling steel in the domestic market.

Question

Quizplus · Accepted Answer

Stringent governmental regulations on domestic steel manufacturers increase their costs of production, which reduces their competitiveness in the international market as foreign firms can produce and sell steel at lower prices. Therefore, Option B is the correct answer.

Stringent Governmental Regulations (E