Transportation costs:

Question

Quizplus · Accepted Answer

Transportation costs have several effects on international trade:
a. raises the price of imported goods: Transportation costs are typically factored into the final price of imported goods. The higher the cost to transport goods from one country to another, the higher the final price that consumers will pay.
b. lowers the volume of imports: When transportation costs are high, the cost of importing goods increases, which can lead to a decrease in demand for these goods. As a result, the volume of imports may decrease because consumers may seek cheaper alternatives or domestically produced goods.
c. are CIF - FAS: CIF (Cost, Insurance, and Freight) and FAS (Free Alongside Ship) are terms used in international shipping contracts to determine when the responsibility and cost for goods transfer from the seller to the buyer. CIF means the seller pays costs, insurance, and freight to bring the goods to the port of destination. FAS means the seller is responsible for the cost of getting the goods alongside the ship. Both terms include transportation costs in their pricing structure.
Therefore, all of the statements a, b, and c are correct in relation to transportation costs, making d. all of the above the correct answer.

Transportation Costs