Yokahama Sports Equipment Ltd. is a successful manufacturer and distributor of sports equipment in the Far East, Australia, and Europe. Top management sees attractive opportunities in the U.S. market because of the stable economy and government. In addition, of course, Americans have disposable income to spend and are willing to buy imported goods. Yokahama executives realize, however, that entering the U.S. market can be difficult and that they’ll need a well-planned strategy.
-If Yokahama tried to get a foot in the door of some foreign markets by pricing certain products lower than it would for its own domestic market,importing nations would see the tactic as an unfair trade practice.

Question

Quizplus · Accepted Answer

This practice is known as dumping, where a company sells a product in a foreign market at a price lower than its domestic market or below its cost of production. It is often considered an unfair trade practice and can lead to trade disputes or the imposition of tariffs and anti-dumping duties by the importing nation.