Suppose that the discriminating monopolist faces antidumping actions in its foreign market. Why might it volunteer to raise its price by $10 in the foreign market in order to settle the action without imposition of an antidumping duty?

Question

Quizplus · Accepted Answer

By voluntarily raising its price by $10, the monopolist might avoid facing a higher antidumping duty, which could be more costly than the $10 voluntary increase. This strategy can be seen as a way to prevent further harm and secure a more stable relationship with the foreign market.

Suppose That the Discriminating Monopolist Faces Antidumping Actions in Its