Question

Persistent dumping, where the home-country price is maintained but where the price in foreign markets is lowered, can be a successful tactic for the selling firm if two conditions are present. what are those conditions?

Answer 1

Conditions for successful international price discrimination.

1) ensure that at any price, the demand schedules of both international and domestic markets have different elasticity and each demand condition differ.

2) the firm must be able to separate the two submarkets (international and domestic) preventing any significant resale of goods intended for lower-priced market to the higher-priced market.