Which of the Following Statements Is True of Import Quotas

question 13

Multiple Choice

Which of the following statements is true of import quotas?

• A) They are the most straightforward denial of absolute or comparative advantage.
• B) They are government payments to domestic firms.
• C) They are rules stipulating that a certain proportion of the value of the goods made in one country must originate from that country.
• D) They are bureaucratic rules that make it harder to import foreign goods.

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Definitions:

Domestic

Relating to or occurring within a particular country; not foreign or international.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service and what they actually pay, measuring the benefit consumers receive from a transaction.

Free Trade

The absence of tariffs, duties, or trade barriers that allows for the unrestricted import and export of goods between countries.

Domestic

Pertaining to or produced within a country's borders, often in contrast to foreign or international.