Looking for the answer to the question below related to Nontariff Trade Barriers ?
Similar to import tariffs import quotas tend to result in
Options:
| a. higher prices and reduced imports b. increased government revenue c. increased consumer surplus d. decreased producer surplus |
The Correct Answer Is:
- a. higher prices and reduced imports
Answer Explanation:
Similar to import tariffs import quotas tend to result in higher prices and reduced imports. Import quotas are another form of trade restriction that can have negative effects on the economy. Similar to import tariffs, import quotas tend to result in higher prices and reduced imports.
Import quotas can also be used to protect domestic industries from competition. This can lead to increased prices for goods and decreased availability of products. Import quotas can also interfere with free trade and create barriers to entry for foreign businesses. The effects of import quotas vary depending on the type of quota and the country implementing it.