An example of political costs is:
A) lower taxes on mining companies.
B) economic sanctions imposed on retailers who purchase their supplies from overseas businesses that use child labour.
C) excessive consumption of perquisites.
D) having a debt covenant.

Question

Quizplus · Accepted Answer

Economic sanctions imposed on retailers who purchase their supplies from overseas businesses that use child labor can be considered a political cost, as it involves taking a stance on a sensitive political issue. It may also lead to backlash and pressure from various interest groups, further adding to the political cost for the company. The other options - lower taxes on mining companies, excessive consumption of perquisites, and having a debt covenant - do not inherently involve political costs.

An Example of Political Costs Is