A Legal Limit on the Amount of a Commodity That

question 19

Multiple Choice

A legal limit on the amount of a commodity that can be imported is known as:

• A)an ad valorem tariff.
• B)an import quota.
• C)an import concession.
• D)an import substitution.
• E)a specific tariff.

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Definitions:

Total Output

The total quantity of goods or services produced by a firm or economy over a specific period.

Invisible Hand

The concept that the self-regulating nature of the marketplace leads to the efficient allocation of resources through individuals pursuing their own self-interest, originally introduced by Adam Smith.

Federal Government

A system of government in which power is divided between a central authority and constituent political units, such as states or provinces.

Central Planning

An economic system where key decisions regarding production, investment, and distribution are made by the government or a central authority, rather than left to market forces.