Under a 1981 Voluntary Trade Agreement Japanese automobile manufacturers were not allowed to increase their exports to the U.S. market. As a result

Question

Quizplus · Accepted Answer

The 1981 Voluntary Trade Agreement limited the export of Japanese automobiles to the U.S. market, which could have impacted their competitive position. Honda, as a result, could have been motivated to circumvent trade barriers through FDI, which could have been a part of their corporate strategy to strengthen their position vis-à-vis their domestic rivals such as Toyota. Therefore, both options B and C are correct. Option A is incorrect as the Japanese manufacturers continued to operate in the U.S. market despite the trade agreement.

Under a 1981 Voluntary Trade Agreement Japanese Automobile Manufacturers Were