Companies in the country of Kollontay can sell semiconductors in the country of Valdivia at a price that is below the cost to Valdivian companies of producing them. To help those Valdivian companies, the Valdivian legislature plans to set a minimum selling price in Valdivia for semiconductors manufactured in Kollontay that is ten percent greater than the average production costs for companies in Valdivia.
Which of the following, if true, most seriously threatens the success of the plan?

Question

Examsnet · Accepted Answer

Correct Answer is :  Emerging companies in countries other than Kollontay will still be able to sell semiconductors in Valdivia at a price below the cost to Valdivian companies to manufacture them.

GMAT Verbal Reasoning Practice Test 6