Reasons for and methods of governments’ intervention in trade

Learning Outcomes:
• Discuss the reasons for and methods of governments’ intervention in trade (Lo 1.2)
• Identify and evaluate the significant trade agreements affecting global commerce (Lo 1.1)
• Carry out effective self-evaluation through discussing economic systems in the international business context (Lo. 3.1)

Critical Thinking
Read the Management Focus on, “NAFTA’s Tomato Wars,” available in your e-book (page no. 620), and answer the following questions:

Assignment Question(s): (Marks: 5)

1. Do you think that Mexican producers were dumping tomatoes in the United States? Discuss.
   (mark:1)
2. Was the Commerce Department right to establish a new minimum floor price rather than scrap the agreement and file an antidumping suit? Who would have benefited from an antidumping suit against Mexican tomato producers? Who would have suffered? (marks:3)
3. What do you think is the optimal government policy response here? Explain your answer. (mark:1)

Answer:
1.

2.

3.

Sample Solution