Selling a good abroad below the price charged in the home market, or at a price below the cost of production is called

Question

Quizplus · Accepted Answer

Selling a good abroad below the price charged in the home market is known as dumping. It is considered an unfair trade practice as it harms domestic producers in the importing country and also leads to a distorted market. It can be done with the intention of driving out competition, gaining market share, or disposing of excess inventory. It may also be done by selling the product below the cost of production. Therefore option A is the correct answer. Option B refers to a policy of replacing imported goods with domestically produced ones. Option C and D are trade barriers used to restrict imports.

Selling a Good Abroad Below the Price Charged in the Home