Questions: Your efforts have been successful! The government of Genovia has decided to address the concerns of the local fishing rod industry by imposing an import tariff on fishing rods. Which of the following business decisions should you make to best capitalize on the newly imposed import tariffs? Select an option from the choices below and click Submit. Exporting fishing rods to neighboring countries because demand for local products in Genovia will decline. Investing in creating more innovative products in order to respond to increasing competition from foreign firms. Pricing your products competitively to gain a larger share of the market.

The answer is: Pricing your products competitively to gain a larger share of the market.

Explanation:

1. Exporting fishing rods to neighboring countries because demand for local products in Genovia will decline: This option is not the best choice because the imposition of import tariffs is likely to increase the demand for local products in Genovia, not decrease it. Import tariffs make foreign products more expensive, which can lead to a preference for locally produced goods. Therefore, focusing on exporting might not capitalize on the increased local demand.

2. Investing in creating more innovative products in order to respond to increasing competition from foreign firms: While innovation is generally a good strategy, the context of the question suggests that the immediate opportunity lies in the local market due to the import tariffs. The tariffs are likely to reduce foreign competition by making imported goods more expensive, thus reducing the immediate pressure to innovate in response to foreign competition.

3. Pricing your products competitively to gain a larger share of the market: This is the best option because the import tariffs will make imported fishing rods more expensive, potentially increasing the demand for locally produced rods. By pricing your products competitively, you can attract more customers who are looking for cost-effective alternatives to the now more expensive imported products. This strategy allows you to capitalize on the increased demand for local products and potentially increase your market share.