a. How would the number of firms competing in a particular market affect the likelihood that an exporter to that market would be accused of dumping? (Assume that the likelihood of a dumping accusation is related to the firm's price difference between its domestic price and its export price: the higher the price difference, the more likely the dumping accusation.) As the number of firms competing in a particular market increases, the price charged by exporters (and domestic firms) will fall dumping charge will be filed. increasing the probability that a b. Would a firm from a large country be more or less likely to be accused of dumping when it exports to a small country (relative to a firm from the small country exporting to the large country)? A firm exporting from a large country to a small country will be likely to be accused of dumping than a firm exporting from a small country to a large country because it will experience a ▼ difference between its domestic price and its export price since there will be firms competing in the smaller country.
a. How would the number of firms competing in a particular market affect the likelihood that an exporter to that market would be accused of dumping? (Assume that the likelihood of a dumping accusation is related to the firm's price difference between its domestic price and its export price: the higher the price difference, the more likely the dumping accusation.) As the number of firms competing in a particular market increases, the price charged by exporters (and domestic firms) will fall dumping charge will be filed. increasing the probability that a b. Would a firm from a large country be more or less likely to be accused of dumping when it exports to a small country (relative to a firm from the small country exporting to the large country)? A firm exporting from a large country to a small country will be likely to be accused of dumping than a firm exporting from a small country to a large country because it will experience a ▼ difference between its domestic price and its export price since there will be firms competing in the smaller country.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:In the chapter, we described a situation where dumping occurs between two symmetric countries. Briefly describe how things would change if the two countries had
different sizes.
a. How would the number of firms competing in a particular market affect the likelihood that an exporter to that market would be accused of dumping? (Assume that the
likelihood of a dumping accusation is related to the firm's price difference between its domestic price and its export price: the higher the price difference, the more likely
the dumping accusation.)
As the number of firms competing in a particular market increases, the price charged by exporters (and domestic firms) will fall, increasing the probability that a
dumping charge will be filed.
b. Would a firm from a large country be more or less likely to be accused of dumping when it exports to a small country (relative to a firm from the small country
exporting to the large country)?
A firm exporting from a large country to a small country will be
likely to be accused of dumping than a firm exporting from a small country to a large country
because it will experience a
difference between its domestic price and its export price since there will be
firms competing in the smaller country.
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