Question

In the 1980’s Voluntary Export Restraints imposed by the United States resulted in:

A.fewer bananas imported into the US

B.Japanese investment in auto manufacturing plants in the US

C.a trade war between the US and Russia

D.Cuban cigars not being available in the US

E.US exports voluntarily reduced

Answer 1

The correct answer is: (B) Japanese investment in auto manufacturing plants in the US

A voluntary export restraint (VER) is a government-imposed limit on the quantity of some category of goods that can be exported to a specified country during a specified period of time.

When the automobile industry in the United States was threatened by the popularity of cheaper, more fuel efficient Japanese cars, a 1981 voluntary restraint agreement limited the Japanese to exporting 1.68 million cars to the U.S. annually as stipulated by U.S Government. The Japanese automobile industry responded by establishing assembly plants or "transplants" in the United States to produce mass market vehicles. That is, Japanese automobile industry began investing  in auto manufacturing plants in the US and partnering production with US based firms.