What Effect Does an Import Quota Have

question 126

Multiple Choice

What effect does an import quota have?

• A)It results in a loss of producer surplus.
• B)It decreases the price of the imported goods to consumers.
• C)It redistributes income away from domestic producers of those products toward domestic producers of exports.
• D)It increases the price of the domestic goods to consumers.

---

Definitions:

Statement of Cash Flows

A financial document that summarizes the amount of cash and cash equivalents entering and leaving a company, essentially showing how the company raises and spends money.

Operating Activities

Activities directly related to the day-to-day operations and business functions such as sales, purchase of inventory, and payment of wages that affect the cash flow of a company.

Financing Activities

These activities include transactions and events that affect the long-term liabilities and equity of an entity, such as issuing debt or equity securities.

Investing Activities

Activities reported on the cash flow statement that relate to the acquisition and disposal of long-term assets and other investments not considered cash equivalents.