Tariffs and Import Quotas Have the Following Differing Outcomes

question 77

Multiple Choice

Tariffs and import quotas have the following differing outcomes:

• A)import quotas do not create deadweight losses but tariffs do
• B)tariffs help domestic consumers and import quotas help domestic producers
• C)tariffs raise revenue for the government but import quotas create a surplus for import licence holders
• D)tariffs increase prices but import quotas do not.

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Definitions:

Evaluating Results

The process of analyzing outcomes and performance against set goals or benchmarks to determine their success or areas for improvement.

Satisficing Decision

The choice of the first satisfactory alternative that comes to one’s attention.

Best Possible Solution

The optimal outcome or answer to a problem, which maximally satisfies the criteria or conditions set forth, often considering constraints and resources.

Satisficing Error

Occurs when decision-makers settle for a solution that is good enough rather than the optimal one, due to limitations in time, resources, or information.