Dumping in international occurs when a foreign firm sells

Analyze the question: It asks for the definition of dumping in international trade.

Concept: Dumping is the sale of goods in a foreign market at a price lower than their cost of production, or lower than the price charged in the producer's home market. Firms do it to:

• capture or eliminate competition in the foreign market,
• get rid of surplus goods,
• gain a larger market share.

Countries often respond with anti-dumping duties or tariffs to protect local industries.

Evaluate the options:

• A. Above its cost of production at home and abroad: Selling above cost is normal profitable trading, not dumping. ✗
• B. Below its cost of production at home and abroad: Dumping is about selling cheaply in the foreign market, not both markets. The firm usually sells at a normal price at home. ✗
• C. More goods than the country has need of: This describes oversupply. Dumping is defined by price, not quantity. ✗
• D. Below its cost of production in a foreign market: This matches the standard definition. ✓

Tip: Remember dumping as "Dump = Dirt cheap in a Different country." Look for the option that mentions a low price in a foreign market.