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Dumping
If goods are sold on a foreign market below their cost of production this is referred to as dumping. This may be undertaken either by a foreign monopolist, using high profits at home to subsidize exports for political or strategic reasons. Countries in which such products are "dumped" feel justified in protecting themselves. This is because dumping could result in the elimination of the home industry, and the country then becomes dependent on foreign goods which are not as cheap as they had appeared.
Substitution Effect on law of demand When price of a commodity falls it becomes comparatively cheaper if price of all other related goods, particularly of substitutes, remain c
Ask questiHow does economic theory contribute to managerial decisions? on #Minimum 100 words accepted#
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