If a U.S.firm sells Vietnamese producer equipment that is then used to make clothing that the United States agrees to buy back from Vietnam,the two companies most likely have entered into a countertrade arrangement called a product buy-back agreement.

Question

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A product buy-back agreement is a form of countertrade where a company sells equipment or technology to a foreign company in exchange for a commitment to buy the resulting products or services. In this case, the American firm sells equipment to a Vietnamese producer, which then uses it to manufacture clothing for the United States. The United States agrees to buy back the clothing, which fulfills the obligation of the product buy-back agreement.

If a USfirm Sells Vietnamese Producer Equipment That Is Then Used to Used