Why the sweden poses a problem for economic policymakers


1. The practice of Canadian firms dumping their products in Sweden poses a problem for economic policymakers since dumping tends to:

  • Become widespread as firms operate at full productive capacity
  • Result in firms charging prices above the total costs of production
  • Favor Swedish consumers over Canadian consumers
  • Favor Swedish producers over Canadian producers

2. If import licenses are auctioned off to domestic importers in a competitive market, their scarcity value (revenue effect) accrues to:

  • Domestic corporations
  • The domestic government
  • Foreign corporations
  • Foreign workers

3.International dumping occurs when foreign buyers are charged higher prices than domestic buyers for an identical product, after allowing for transportation costs and tariff duties.

  • True
  • False

4. To maintain that South Koreans are dumping their VCRs in the United States is to maintain that:

  • The cost of manufacturing VCRs in Korea is lower in Korea than in the United States since wages are lower in Korea
  • Koreans are selling VCRs in the United States below their production cost
  • Koreans are selling VCRs in the United States above their production cost
  • The cost of manufacturing VCRs in Korea is higher in Korea than in the United States since wages are higher in Korea

5. In certain industries, Japanese employers do not lay off workers. Therefore, they sometimes have excess supplies of goods that they cannot sell on the home market without lowering prices. To hold down losses, they sell goods in overseas markets at prices well beneath those in Japan. This practice is best referred to as:

  • Domestic content pricing
  • Dumping
  • Orderly marketing
  • Trigger pricing

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Macroeconomics: Why the sweden poses a problem for economic policymakers
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