The viability of an exporting strategy is often constrained by transportation costs,particularly of products that have a _____ and that can be produced in almost any location.
A) high local content requirement
B) low total landed cost
C) low value-to-weight ratio
D) low licensing tariff
E) high marginal cost

Question

Quizplus · Accepted Answer

Products with a low value-to-weight ratio are expensive to transport relative to their value. This makes exporting them less viable, as transportation costs can eat into profits. Products with high local content requirements and low licensing tariffs may face other barriers to entry, such as legal and regulatory hurdles. Products with low total landed cost and high marginal cost may be more profitable to produce locally rather than exporting.

The Viability of an Exporting Strategy Is Often Constrained by Transportation