Question

For positive proof that dumping has occurred in the United States, both ________ and injury must be demonstrated.

A) black marketing
B) market skimming
C) gray marketing
D) price discrimination
E) price fixing

Answer 1

To prove dumping in the U.S., both D) price discrimination and injury need to be shown. Dumping involves selling products at below production costs to drive out domestic competitors, also known as predatory pricing.

Step-by-step explanation:

For positive proof that dumping has occurred in the United States, both price discrimination and injury must be demonstrated. Dumping refers to a practice where foreign firms sell goods at prices below the cost of production for a short period of time. This may lead to them driving out domestic competition, and potentially hiking up the prices afterwards, which is a strategy known as predatory pricing. Anti-dumping laws are intended to protect domestic industries from such practices, although the economic theory behind these laws is often debated since it's been difficult to find evidence of foreign producers significantly raising prices after eliminating domestic competition.