April 2021 — Question 68
A foreign subsidiary sells ore to its U.S. parent company. The price of the ore charged by the subsidiary to its parent is the price of ore on the New York Mercantile Exchange on the date the ore arrives in the United States. Select the statement that is TRUE regarding this price.
- AThe price is acceptable under transaction value as it is based upon a formula which neither party can control.✓ CBP's answer
- BThe price is not acceptable because it is not known at the time of shipment.
- CThe price is not acceptable because the parties are related.
- DThe price is acceptable under deductive value because it is based on the price of ore sold in the United States.
- EThe price is acceptable because the parties are related.
CBP's cited authority
§ 19 CFR § 152.103(a)(1)
Answer and citations as published in CBP's official answer key for the April 2021 examination.
Reading answers is easy. The exam is 80 of these in 4.5 hours.
Pass rates run 12–30%. Find out in 15 minutes whether you'd clear the 75% line today — free, no signup.