Question

Which option identifies the concept represented in the following scenario?

In 1978, the Florida vegetable industry filed a complaint against Mexican farmers for underpricing their produce in the U.S. market.

monocropping
quotas
dumping
sustainability

Answer 1

dumping

Step-by-step explanation:

Dumping in international trade refers to exporting goods to another country at a lower price than in the domestic market. A company or country involved in dumping may sell goods in a foreign country below the production cost. The objective is to gain market penetration and acquire a sizable market share in the targeted country.

Dumping enables customers in the importing country to buy goods at a lower price. However, it may kill local industries leading to the closure of businesses and layoffs.