Which of the following is true of indirect exports?
A) They typically provoke protectionism, potentially triggering antidumping actions.
B) They treat foreign demand as an extension of domestic demand.
C) They export through domestically based export intermediaries.
D) They do not enjoy the economies of scale similar to direct exports.

Question

Which of the following is true of indirect exports? 
A) They typically provoke protectionism, potentially triggering antidumping actions. 
B) They treat foreign demand as an extension of domestic demand. 
C) They export through domestically based export intermediaries. 
D) They do not enjoy the economies of scale similar to direct exports.

Quizplus · Accepted Answer

Indirect exports are made through domestically based export intermediaries, such as export trading companies or export agents. This allows smaller companies to access foreign markets without having to go through the trouble of setting up their own international distribution networks. Indirect exports can actually help reduce the risk of protectionism, as the intermediary takes on some of the risks associated with foreign trade. They also do not necessarily treat foreign demand as an extension of domestic demand, but rather offer products tailored to the needs of the foreign market. The statement in option D is incorrect; indirect exports may enjoy economies of scale through the use of intermediaries.

Which of the Following Is True of Indirect Exports