Which of the Following Is Common to Both Tariffs and Quotas

question 131

Multiple Choice

Which of the following is common to both tariffs and quotas?

• A)Tariffs and quotas are both used as a means to increase government revenue.
• B)Tariffs and quotas both increase economic efficiency.
• C)Tariffs and quotas are both designed to reduce foreign competition faced by domestic firms.
• D)Tariffs and quotas are both examples of voluntary export restraints.

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Definitions:

Supply Curve

A visual chart that illustrates how the price of an item affects the amount of the item that sellers are prepared to offer.

Inferior Good

A product whose demand decreases as consumers' income levels increase, opposite to normal goods.

Income Rises

An increase in the amount of money received by individuals or households, often measured on an annual basis.

Complementary Goods

Products or services that are often used together, where the increase in demand for one leads to an increase in demand for the other.