A Difference Between a Quota and a Tariff Is That

question 28

Multiple Choice

A difference between a quota and a tariff is that

• A)a tariff generates a greater reduction in exports than does an import quota.
• B)the government collects revenue from a tariff but does not collect revenue from an import quota.
• C)an import quota increases profits of domestic producers more than a tariff.
• D)a tariff generates a higher price than does an import quota.
• E)an import quota creates a social loss and a tariff does not.

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Definitions:

Expansion Opportunities

Opportunities for a business to grow, either through entering new markets, increasing product lines, or acquiring other businesses.

Sole Proprietor

An individual who owns and operates a business alone, bearing sole responsibility for its operations and liabilities.

Dissolve

To disperse or disappear into a solution, or in a corporate context, to legally terminate a company.

Domestic Corporation

A corporation that is registered and operates within its country of incorporation.