United State Pharmaceutical $($USP$)$

Pharmaceutical $($USP$)$ is an American firm which concentrates on the ethical drug

business but has diversified into animal health products, cosmetics and some other

patent medicines. USP$$s international business is conducted in some $70$ countries,

mostly through distributors in these markets

USP$$s only Latin American manufacturing operations are in Latinia, a country with a

population of about $30$ million. The pharmaceutical division operates USP$$s plant in

Latinia. All the other divisions, which also sell in Latinia, export their finished products

from the USA.TheLatinian plant employs $430$ persons, of whom only two are Americans.

USP$$s cosmetics and toiletries business accounts for $$120$ million in sales. One of the

division$$s better foreign markets is Latinia, where it has sales of over $$5$ million and an

acceptable market position.

The Cosmetics and Toiletries Division has a marketing subsidiary in Latinia to handle its

business there

The government of Latinia announced the imposition of increased tariffs on many $$nonessential products because of balance of payments pressures being experienced by the

country.

For USP$$s Cosmetics and Toiletries Division, this means a rise in the tariffs it pays from

$20$ percent to $50$ percent ad valorem. Management considers that this $50\%$ duty was an

insurmountable barrier.

Cosmetics and Toiletries competition in Latinia is evenly divided between local firms and

other international companies from Europe and North America. Local firms, which had

about $40\%$ of the market, stood to benefit greatly

When the management got the information about the increased duties, a meeting was

called to evaluate the four options available to the Division and decide on the best one

that will minimize the impact of the duties $.$

Eloborate on any the courses of action that the companys management can consider $.$ cited with reference in APA FORMAT