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Int 7

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Gale Pooley
Gale Pooley

Int 7

Economy & Finance
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Lecture 7 - Global Economy ECON 360 International Economics
Name five reasons President Trump could use in support of protecting an industry from foreign competition.
Dumping Subsidized Industries Infant Industries Cultural National Defense
Dumping Underpricing exports What’s wrong with low prices?
Dumping Unfair to producers Monopoly Predatory Pricing
The purpose of an economy is to satisfy consumers
How can one producer be unfair to another producer?
Maximize incentives to create value for consumers.
Do low prices hurt consumers?
Argument Set prices below cost Drive out competition Raise prices as a monopoly No new competition
How many firms does it take for competition to occur? One, as long as there is potential for more
If you don’t want competition Keep prices low
Why would prices be lower in one country over another? Demand Competition Selling costs
How do you bankrupt efficient producers? Predator must sell more at a lower price
Japan drives out all American producers China drives out Japanese producers
Argument Set prices below cost Drive out competition Raise prices monopoly Were they really below cost? New competition Evidence?
Who wins a price war? Consumers

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Int 7