Global Business – Systems, Strategies, And Cultural Dynamics Practice Exam

Dumping is when a company sells a product in a foreign market at a price that is lower than its normal value, typically below the cost of production. This practice is pursued to quickly gain market share or unload excess capacity, but it can distort competition and invites anti-dumping actions by importing countries. Among the options, the one that aligns with the common definition is selling for less than the cost of production. Selling at market price is normal trade pricing, selling for more than production cost is simply earning a profit, and selling domestically only isn’t about international pricing. If your materials list a different answer, note that standard economic definitions define dumping as pricing below production cost (or below the product’s normal value in the foreign market).