The cost of producing radios in country Q is ten per cent less than that in country Y. Even after transportation fees and tariff charges are added, it is still cheaper for a company to import radio from country Q to country Y than to produce them in country Y. Which of the following, if true best supports the statement above?

A Labor cost in country Q is 10 per cent lower than that in country Y.

B Importing radios from country Q to country Y will eliminate 10 per cent of the manufacturing jobs in country Y.

C The tariff on a radio imported from country Q to country Y is less than 10 percent of the cost of manufacturing the radio in country Q.

D The fee for transporting a radio from country Q to country Y is more than 10 per cent of the cost of manufacturing the radio in country Q

Solution

Correct Answer: Option C

Solution

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