A foreign-trade zone (FTZ) is ?
Correct answer: D. designed to promote exports by deferring imports duties on intermediate inputs and waving such duties if the final product is re-exported rather than sold domestically
- A. a regional area within which trade with foreign nations is allowed
- B. a free trade agreement among several nations
- C. designed to limit exports of manufactured goods by placing export taxes on goods made within the zone
- D. designed to promote exports by deferring imports duties on intermediate inputs and waving such duties if the final product is re-exported rather than sold domestically
Explanation
An FTZ encourages exports by allowing duties on imported intermediate inputs to be deferred, and those duties are waived when the finished goods are re-exported. Duties generally become payable if the goods enter the domestic market.
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