If a Quota Is Set at the Same Quantity of Imports

question 90

Multiple Choice

If a quota is set at the same quantity of imports that results from a tariff,

• A)the deadweight loss from the tariff is greater than the deadweight loss from the import quota.
• B)the deadweight loss from the tariff equals the deadweight loss from the import quota.
• C)the deadweight loss from the import quota is greater than the deadweight loss from the tariff.
• D)the government tariff revenue is greater than the importers' profit from the import quota.
• E)the government tariff revenue is less than the importers' profit from the import quota.

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Definitions:

Dictator Game

An experimental paradigm in behavioral economics where one player, "the dictator," determines how to split an endowment between themselves and another player.

Behavioral Economists

Investigators who explore how various psychological, cognitive, emotional, cultural, and social factors determine the economic decisions of both individuals and organizations.

Time Inconsistency

A situation where a person's preferences change over time in such a way that what is preferred at one point in time is inconsistent with what is preferred at another time.

Behavioral Economics

A field of economics that examines the effects of psychological, cognitive, emotional, cultural, and social factors on the economic decisions of individuals and institutions.