Question

Insurance, packaging & transportation costs are levied on products as they are _________.

• A. substituted goods
• B. goods to be physically moved
• C. produced goods
• D. repurchased goods

Answer 1

Answer: (B)

goods to be physically moved

• The goods are physically moved in international business i.e the goods are imported or exported from a country to the destination.
  
• Since the goods physically move from one country to another, exporting/importing involves additional packaging, transportation and insurance costs. Especially in the case of heavy items, transportation costs alone become an inhibiting factor to their exports and imports.