The government of Lithaya placed a large order for buses with Blue Ace Inc.,a manufacturing company in Lodesia.In return,it asks the company to subcontract some work to Lithayan manufacturers.This is an example of a(n)_____ in international business.

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An offset agreement is an arrangement in international business where a government places an order for goods or services with a foreign company and, in return, the foreign company agrees to subcontract some of the work to local manufacturers. This helps to promote domestic industries and can be a requirement for winning government contracts in certain countries. In the given scenario, the Lithayan government has placed an order for buses with Blue Ace Inc. and asked the company to subcontract some work to Lithayan manufacturers, which is an example of an offset agreement.

The Government of Lithaya Placed a Large Order for Buses