Many United States companies have, unfortunately,

  made the search for legal protection from import

  competition into a major line of work. Since 1980 the

  United States International Trade Commission (ITC)

  (5) has received about 280 complaints alleging damage

  from imports that benefit from subsidies by foreign

  governments. Another 340 charge that foreign compa-

  nies “dumped” their products in the United States at

  “less than fair value.” Even when no unfair practices

  (10) are alleged, the simple claim that an industry has been

  injured by imports is sufficient grounds to seek relief.

  Contrary to the general impression, this quest for

  import relief has hurt more companies than it has

  helped. As corporations begin to function globally, they

  (15) develop an intricate web of marketing, production, and

  research relationships, The complexity of these relation-

  ships makes it unlikely that a system of import relief

  laws will meet the strategic needs of all the units under

  the same parent company.

  (20) Internationalization increases the danger that foreign

  companies will use import relief laws against the very

  companies the laws were designed to protect. Suppose a

  United States-owned company establishes an overseas

  plant to manufacture a product while its competitor

  (25) makes the same product in the United States. If the

  competitor can prove injury from the imports---and

  that the United States company received a subsidy from

  a foreign government to build its plant abroad—the

  United States company’s products will be uncompeti-

  (30) tive in the United States, since they would be subject to


  Perhaps the most brazen case occurred when the ITC

  investigated allegations that Canadian companies were

  injuring the United States salt industry by dumping

  (35) rock salt, used to de-ice roads. The bizarre aspect of the

  complaint was that a foreign conglomerate with United

  States operations was crying for help against a United

  States company with foreign operations. The “United

  States” company claiming injury was a subsidiary of a

  (40) Dutch conglomerate, while the “Canadian” companies

  included a subsidiary of a Chicago firm that was the

  second-largest domestic producer of rock salt.

  1. The passage is chiefly concerned with

  (A) arguing against the increased internationalization of

  United States corporations

  (B) warning that the application of laws affecting trade

  frequently has unintended consequences

  (C) demonstrating that foreign-based firms receive more

  subsidies from their governments than United States

  firms receive from the United States government

  (D) advocating the use of trade restrictions for

  “dumped” products but not for other imports

  (E) recommending a uniform method for handling

  claims of unfair trade practices

  2. It can be inferred from the passage that the minimal

  basis for a complaint to the International Trade

  Commission is which of the following?

  (A) A foreign competitor has received a subsidy from a

  foreign government.

  (B) A foreign competitor has substantially increased the

  volume of products shipped to the United States.

  (C) A foreign competitor is selling products in the

  United States at less than fair market value.

  (D) The company requesting import relief has been

  injured by the sale of imports in the United States.

  (E) The company requesting import relief has been

  barred from exporting products to the country of its

  foreign competitor.

  3. The last paragraph performs which of the following

  functions in the passage?

  (A) It summarizes the discussion thus far and suggests

  additional areas of research.

  (B) It presents a recommendation based on the evidence

  presented earlier.

  (C) It discusses an exceptional case in which the results

  expected by the author of the passage were not


  (D) It introduces an additional area of concern not

  mentioned earlier.

  (E) It cites a specific case that illustrates a problem

  presented more generally in the previous paragraph.

  4. The passage warns of which of the following dangers?

  (A) Companies in the United States may receive no

  protection from imports unless they actively seek

  protection from import competition.

  (B) Companies that seek legal protection from import

  competition may incur legal costs that far exceed

  any possible gain.

  (C) Companies that are United States-owned but operate

  internationally may not be eligible for protection

  from import competition under the laws of the

  countries in which their plants operate.

  (D) Companies that are not United States-owned may

  seek legal protection from import competition under

  United States import relief laws.

  (E) Companies in the United States that import raw

  materials may have to pay duties on those materials.

  5. The passage suggests that which of the following is

  most likely to be true of United States trade laws?

  (A) They will eliminate the practice of “dumping”

  products in the United States.

  (B) They will enable manufacturers in the United

  States to compete more profitably outside the

  United States.

  (C) They will affect United States trade with Canada

  more negatively than trade with other nations.

  (D) Those that help one unit within a parent company

  will not necessarily help other units in the company.

  (E) Those that are applied to international companies

  will accomplish their intended result.

  6. It can be inferred from the passage that the author

  believes which of the following about the complaint

  mentioned in the last paragraph?

  (A) The ITC acted unfairly toward the complainant

  in its investigation.

  (B) The complaint violated the intent of import relief


  (C) The response of the ITC to the complaint provided

  suitable relief from unfair trade practices to the


  (D) The ITC did not have access to appropriate

  information concerning the case.

  (E) Each of the companies involved in the complaint

  acted in its own best interest.

  7. According to the passage, companies have the general

  impression that International Trade Commission import

  relief practices have

  (A) caused unpredictable fluctuations in volumes of

  imports and exports

  (B) achieved their desired effect only under unusual


  (C) actually helped companies that have requested

  import relief

  (D) been opposed by the business community

  (E) had less impact on international companies than the

  business community expected

  8. According to the passage, the International Trade

  Commission is involved in which of the following?

  (A) Investigating allegations of unfair import


  (B) Granting subsidies to companies in the United States

  that have been injured by import competition

  (C) Recommending legislation to ensure fair

  (D) Identifying international corporations that wish to

  build plants in the United States

  (E) Assisting corporations in the United States that wish

  to compete globally