Which of the Following Statements About Import Quotas Is True

question 7

Multiple Choice

Which of the following statements about import quotas is true?

• A) Voluntary quotas established by the exporting country reduce the importing country's deadweight loss from the trade restriction.
• B) An import quota reduces the price to the domestic consumers.
• C) An import quota increases the welfare of domestic producers.
• D) Import quotas are preferred to tariffs because they raise more revenue for the imposing government.

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Definitions:

Reactive

A response or behavior that occurs as a direct result of stimuli or situations, often implying a lack of proactive planning or initiative.

Social Networking

The use of internet-based platforms to connect, share, and interact with others.

Human Capital Perspective

A viewpoint that considers employees as assets whose value can be enhanced through investment in education, training, and development.

Decentralized

Refers to the distribution of functions, powers, people, or things away from a central location or authority.