A firm with excess capacity assigns all fixed costs to domestic production.For the international markets,the firm uses a pricing scheme that focuses mainly on variable costs.This strategy allows the firm to offer its products abroad at a cost lower than at home.The firm in question could be accused of _____.

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The firm is engaging in dumping, which is the practice of selling products in a foreign market at a lower price than in the domestic market with the intention of driving competitors out of the market. By assigning all fixed costs to domestic production, the firm can offer products to international markets at a lower price than domestic markets. This pricing scheme focuses on variable costs, which helps to offer products abroad at a lower cost. This pricing practice could be accused of unfair trade practices and result in legal action.

A Firm with Excess Capacity Assigns All Fixed Costs to Domestic